Warner Bros. Discovery CFO Says Streaming Bundles Are Not ‘Easy Thing to Pull Off’ Despite Consumer Benefit

Warner Bros. Discovery chief financial officer Gunnar Weidenfels believes that “consumers would benefit from some form of rebundling” of streaming services – but that’s easier said than done.

“I think a lot of people are thinking about that and there are a lot of different models how that could be set up,” the executive said during J.P Morgan’s Global Technology, Media and Communications Conference on Wednesday.

However, he acknowledged that there are many questions surrounding how such a product and its economics would be structured that would make it difficult to pull off.

“It’s very hard to get perfectly aligned interests in a setup like that,” he added. “So I do think it’s compelling to think about some form of rebundling but I don’t think it’s an easy thing to pull off and I certainly don’t expect anything to happen in the short term here.”

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Weidenfels’ comments echo those of Warner Bros. Disocvery CEO David Zaslav, who revealed last week that he would be open to leveraging Max in a bundle with other streaming services if it meant creating a better experience for consumers.

“For me, it seems very clear that if we were to package this great product that we have with others, if we were to wake up tomorrow and in each market if we’re the No. 1, 2 or 3 product, if we were marketed with two or three [streamers] for a specific price, it would be great for consumers and would probably reduce churn,” Zaslav said during MoffettNathanson’s inaugural Technology, Media & Telecom Conference. “We’d both be marketing one product and it would provide a meaningful consumer experience. Not just on price but that ‘OK, I now have a bigger package of content that’s broader.'”

The chief executive warned that if the owners of content don’t consolidate themselves through bundling, then platforms like Roku and tech companies like Amazon and Apple would do it for them.

“Whether we do it this year or in three years, I think eventually something like that will happen. If we don’t do it to ourselves, I think it’ll be done to us,” he said. “It’ll be Amazon that does it, it’ll be Apple that does it, it’ll be Roku that does it. They’re already starting to do it. And it makes sense. A lot of people will go to some of those platforms as an easier curation of finding what they like.”

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In addition to the bundling comments, Weidenfels spoke about how the Max launch has been progressing since officially rolling out on Tuesday.

Max, which combines the library of HBO Max and Discovery, offers three pricing tiers: Max Ad Lite for $9.99 per month, Max Ad-Free for $15.99 per month and Max Ultimate Ad-Free for $19.99 per month. Though the service experienced minor technical glitches in its first day of rollout, a WBD spokesperson confirmed to TheWrap that they were quickly remedied.

“You must always anticipate issues on a tech rollout of this scale,” the spokesperson added.

Weidenfels noted that the most evident improvements consumers will see are faster downloads and better technical stability and content discovery.

“It’s day one, but so far, so good,” he said. “We’re really in the first innings where we launched the product and the basic thesis here is that we can get better engagement and a more satisfactory consumer experience with this combined portfolio.”

He also acknowledged that Warner Bros Discovery is monitoring the trend of cord-cutting and decline of linear and cable TV network subscribers.

“I don’t think we need to be at the leading edge of disruption here but we’re clearly monitoring what’s going on and I believe there will be an opportunity for an equilibrium where linear doesn’t go away completely but already today there are more people outside of the traditional bundle then inside the traditional bundle,” he said. “So as an industry we have to acknowledge that and we have to find a way to service with any kinds of rights and any kinds of content both of those populations. And I think there is an equilibrium that will be beneficial and we’re thinking through all the different scenarios … there’s a lot of planning going on about how that could look for Warner Bros. Discovery but it’s premature to talk about it more specifically.”

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