AUDIE CORNISH, HOST:
Cable cord-cutters are more than a little excited today about news from HBO.
The head of the premium channel known for movies and award-winning television shows like "Game Of Thrones" and "True Detective" told investors HBO plans to offer a stand-alone streaming video service. But the real news - that customers might be able to access it online without buying a cable subscription. Here to tell us more is NPR TV critic Eric Deggans.
Hey there, Eric.
ERIC DEGGANS, BYLINE: Hey.
CORNISH: So Eric to start, tell us a little bit more about what HBO's trying to do here.
DEGGANS: Well, we don't really know many details including how much it would cost or when this service might debut. HBO's chairman and CEO Richard Plepler told investors the company would create this online streaming service separate from cable subscriptions next year. And the CEO said there were about 10 million people out there who buy broadband Internet service but don't also buy cable TV, which is a huge market for them.
CORNISH: Now, Eric, for a long time HBO said that it didn't want to do this and also cable companies have said that it couldn't be done - buying a cable channel without buying the whole service. So what are the factors at work here?
DEGGANS: Well, you're right. Cable companies have said for a long time that the economics of their business require customers to buy channels that they don't want to get the channels that they like. So they spread the cost over lots of channels so you pay for a service that includes ESPN even if you never watch sports on TV, just so you can see, say, CNN. HBO is now offering customers a way to buy just HBO without paying for any of the other cable channels and there's some thought that cable companies that offer broadband can also sell HBO GO access with their broadband services and still keep their connection to customers. But HBO is really developing a direct link to viewers that's apart from the cable companies for the first time. And if this works, you can be sure that there's going to be other big content companies like Viacom and Disney that are going to follow suit. And with more customers deciding to cut that cord and go without cable TV programming because it costs so much, that's going to increase the pressure for cable companies to offer ways to buy smaller groups of channels, which we call a la carte programming.
CORNISH: Now, these cable companies have already been feeling some pressure, right, from streaming services like Netflix and Amazon Prime? People have argued that maybe these services could help bring prices down. How does this news affect that industry?
DEGGANS: Well, HBO seems to have stepped up its competition with Netflix and these other services by turning itself into a very similar service. I mean, if HBO GO is a stand-alone service, it's going to offer a lot of the stuff that Netflix already does - movies, documentaries, comedy specials, sports, along with current episodes of all their HBO series'. Now, they won't have the vast library of non-HBO TV shows that Netflix and Amazon have, at least at first, but if they're serious about developing the stand-alone service, it could easily become a rival to Netflix or Amazon, Yahoo, AOL - any of these other companies that are trying to develop online TV packages.
CORNISH: Finally Eric, I mean, what's at stake more broadly here for the cable TV business?
DEGGANS: Well, I think what it ultimately confirms is a lesson that many in media should've learned by now, which is that what the consumer wants is most important. For many years consumers have been begging for a way to buy direct access to cable TV content they like without spending money on content they don't want. And HBO's service, if it works, will push everyone in media to do the same thing.
CORNISH: That's NPR TV critic Eric Deggans. Eric, thanks so much.
DEGGANS: Always a pleasure. Transcript provided by NPR, Copyright NPR.
