Warner Bros. Discovery’s stock experienced a significant boost on Thursday after the company announced a deal with Charter Communications to bring the Max streaming service to standard cable packages. The stock closed up 10.3% at $7.66, recovering from recent losses and marking a 13% increase over the past month. However, the stock is still far below its highs from earlier in the year. The deal with Charter will offer ad-supported versions of Max and Discovery+ to Spectrum cable customers at no extra charge, eliminating the $15 add-on fee currently required for Max.
Charter customers will now have access to a $65 cable bundle that includes basic tiers of competing services like Disney+ and Paramount+. This move comes as Warner Bros. Discovery aims to increase its streaming subscriber numbers, with CEO David Zaslav expecting an additional six million subscribers for Max in the latest quarter. However, the company has faced challenges in the past year, particularly due to the decline in the cable TV business and the potential loss of its media rights partnership with the NBA and TNT. The company’s stock has dropped more than 33% since January, when it traded at over $11.60.
The agreement with Charter comes at a critical time for both companies, as Charter reported a loss of 393,000 TV subscribers in the second quarter, reflecting the ongoing trend of cord-cutting. Video revenue also declined, totaling $3.9 billion in the second quarter. By integrating streaming platforms like Max into its cable bundles, Charter hopes to offset some of these losses and attract new customers. The deal with Warner Bros. Discovery is expected to further enhance the company’s offerings and provide added value to Spectrum customers.
While Warner Bros. Discovery continues to face challenges in the rapidly changing media landscape, the company’s partnership with Charter represents a strategic move to expand its reach and compete in the streaming market. As the company focuses on growing its streaming subscriber base, the addition of Max and Discovery+ to Spectrum’s cable packages will likely attract new customers and enhance the overall viewing experience for existing subscribers. The success of this partnership will be crucial for both Warner Bros. Discovery and Charter as they navigate the evolving industry landscape and strive to remain competitive in the streaming market.
