As Discovery, Inc. reports what could be its final earnings before officially becoming Warner Bros Discovery, Parrot Analytics has assessed where the new company will stand in the race for streaming and entertainment supremacy.
The combined entity is projected to start out in second place in corporate demand share, leapfrogging Paramount and sitting within striking distance of market leader Disney in this key metric that serves as a proxy for the longterm viability of media companies as they eventually bring their full catalogs onto a unified streaming platform or bundle.
In terms of SVODs, the crown jewel of the joint company will clearly be HBO Max, which saw massive growth in 2021. HBO Max has maintained this momentum in early 2022, with breakout hits such as Peacemaker and Euphoria becoming mainstays in the US and global top ten TV demand charts since January.
HBO Max is a very well rounded streaming service which appeals to numerous key genres, especially dramas, comedies, and adult animation. Discovery+, on the other hand, is more of a one trick pony that is all in on reality and documentary series. That said, Discovery+’s one trick is in the major category that HBO Max is lacking - unscripted content - and which rival Netflix has made significant inroads in over the last two years.
Discovery+'s abundance of highly in-demand unscripted programming - from several of the most watched cable networks in the US - will service an audience that HBO Max has yet to tap. It will provide the Warner Bros Discovery ecosystem with a whole new audience without HBO/HBO Max having to reinvent the wheel with untested unscripted content of its own.
Whether Warner Bros Discovery decides to combine Discovery+ into HBO Max, or bundle the services, Discovery and WarnerMedia will combine to create a formidable offering that will rival Netflix as the top streaming platform, and Disney at the top overall media conglomerate in the US.
Corporate Demand Share - United States, 2021
- Corporate Demand Share assesses the long-term viability of the top media companies as they look to consolidate their original content’s availability exclusively onto their own platforms.
- On its own, Discovery (7%) was the sixth largest media company in the US by corporate demand share in 2021, close behind Netflix (7.7%) and trailing the four big legacy media conglomerates by a wider margin - Disney (20.1%), Paramount (13.4%), WarnerMedia (11.9%) and NBCUniversal (10.8%).
- Merging its assets with that of WarnerMedia gives the new company, Warner Bros Discovery, the second largest corporate demand share (18.9%), just 1.2 percentage points behind Disney, which leads the field by 6.7 percentage points (over Paramount) pre-merger.
- This chart shows how formidable of a company Warner Bros Discovery will be long term.
On-Platform Demand Share - United States, Q4 2021
- Discovery+ (6.6%) was the seventh largest streaming platform by on-platform demand share in the US in Q4 2021.
- HBO Max (10.9%) was the third biggest platform for on platform demand in the US last quarter.
- Merging the two services would further solidify their place as the third most in-demand platform, and put it within a few percentage points of Hulu and Netflix.
Genre breakdown - HBO Max & Discovery+, Q4 2021
- Breaking down each of the major platforms by genre demand share shows that HBO Max and Discovery+ should succeed at complementing, and not cannibalizing, one another’s audiences.
- Reality and documentary programming make up 93.8% of the on-platform demand for Discovery+. With so little diversification, this service can build a loyal and passionate base, but is not likely to scale up long term.
- Unscripted genres account for just 9.3% of the on-platform demand for HBO Max.
- Therefore, Discovery+ is filling in a big hole and bringing an entirely new audience to a potential HBO Max bundle or combination of services, that HBO won’t have to fill on its own.
- Meanwhile, Discovery+ will benefit from being tied to the much more diverse and highly in-demand slate of programming on HBO Max.
Most In-Demand Series on Discovery+ - US, Q4 2021
- While it lacks a breakout exceptionally in-demand series, Discovery+ is a hotbed of the most in-demand unscripted content with American audiences, filling in a crucial audience gap that HBO Max does not currently serve.
- These are also the kind of “snack-able” comfort TV shows that people put on in the background as they’re making dinner or working from home.
- It’s the type of content that gets audiences to always return to the platform, making it an essential part of their entertainment consumption, meaning they are less likely to churn.
Most In-Demand Series on HBO Max - US, Q4 2021
- HBO Max is of course home to several of the most iconic and highly in-demand TV series across all platforms with US viewers.
- South Park (#3), Game of Thrones (#6) and Sesame Street (#7) all landed in the top ten TV shows in the US for Q4 2021. These three shows cater to vastly different audiences, showing the breadth of appeal for HBO Max as a service.
- Two other series available on HBO Max landed in the top 0.2% of shows in Q4 - Emmy-winning Succession (32.2x more demand than the average show in the US) and HBO Max Original Titans (36x).