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HBO discussed buying Netflix in 2006

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“The goal is to become HBO faster than our HBO can become.”

This is Netflix CEO Ted Sarandos in 2013, shortly before his company made the jump to original content with house of paper. And not just original content – big-budget glossy content made by a famous director, featuring (at the time) a famous actor. HBO-style content.

Even if you don’t follow the media business closely, you probably know what happened next: with house of paperNetflix has proven, very quickly, that it can deliver shows as good as the stuff the legendary pay-TV network is made of. Then Netflix started making more stuff, and consumers loved it, too. And now Netflix is ​​the company that every other media company wants to emulate – which is the main reason every big media company tries to decide whether they need to buy or sell to every other big media company.

But it didn’t have to go this way. In 2005, two years before Netflix entered the streaming business, some HBO executives were pushing the company to do the same. They wanted HBO to use the Internet to sell subscriptions directly to consumers rather than wholesale their products to major cable TV distributors.

A year later, after that idea was passed, HBO considered another move that would rewrite media history: Some of its executives wanted HBO to buy Netflix, which at the time was a nearly $1 billion mail-order DVD rental company.

Netflix is ​​now worth about $300 billion. And HBO, which didn’t start selling its Netflix-like service until 2015, is under pressure to keep up with not only Netflix but a host of streaming competitors, such as Disney+, Peacock and Amazon Prime Video. Meanwhile, HBO’s parent company has changed hands three times in the past three years.

Both stories about HBO not making decisions, which I’ve never seen before, appear in Tinderbox: HBO’s relentless pursuit of new heights, a new oral history book by journalist James Andrew Miller, who has previously reported on major media organizations such as ESPN and Saturday Night Live. The book is a 50-year tale that is partly a behind-the-scenes look at HBO’s game-changing shows such as game of Thrones, and partly a behind-the-scenes history of HBO, which contains a lot of OwnsLike plot twists. I talked to Miller about all this this week Re-encode the media The episode you can listen to is at the bottom of this post or on the podcast platform of your choice.

But with Miller’s stories raising eyebrows, you don’t want to add to the weight of an alternate history you could generate.

Even if HBO and Time Warner, the parent company, decided in 2005 to start selling HBO programming directly to consumers at that time, it might not have been a success. At the time, most American homes did not have broadband Internet. Most importantly, the cable television industry on which HBO relied for its distribution at the time would have struggled hard to make sure it wasn’t dislodged.

And the purchase of Netflix in 2006 would not have ensured that HBO would have ended up owning Netflix today. If anything, once Netflix became part of a large entertainment group, it surely would have made different decisions than when it was a young player trying to figure out how to compete with the entertainment conglomerates.

Yet the stories Miller discovers in his book are a useful reminder that the accounts we often hear about media history — or any history — are just that: narratives, which tend to clean up and simplify, depending on who is telling them.

In this case, HBO and Time Warner are often portrayed as big, lumbering media dinosaurs shocked by the future. And the fact that former Time Warner CEO Jeff Bewkes did his best to talk about both Netflix and the rise of wire-cutting, when both were on the rise, helps fuel the controversy. But the fact that at least some HBO executives can see what happens to their industry complicates matters: Should they take credit for their insight, even if they can’t act on it?

Speaking of Bewkes, treated well in Miller’s book: He said that by 2014, he also understood what Netflix and the rest of his company’s tech business was doing, even if he wasn’t saying it publicly: “We’re going to either acquire or merge with someone to get what We need him to compete with the digital giants, or, failing that, sell Time Warner. … I told the board that in the long run, Google, Facebook, Netflix, Amazon and possibly Apple will lose all media companies.”

Bewkes even discussed merging his company with Apple, but in his account, Apple wasn’t ready for it: “I wish we could do that.”


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