Warner Bros. Discovery Inc (WBD) and Charter Communications, Inc (CHTR) have entered into a multi-year distribution partnership, combining the best of linear video and streaming services. The agreement comes as a boon for both companies, as evidenced by the surge in their stock prices following the announcement.
This collaboration brings Warner Bros. Discovery’s premium streaming platform, Max (Ad Lite), to Charter’s Spectrum TV Select packages. Max (Ad Lite) boasts a wealth of content, including all HBO and Max titles, as well as Discovery+. This means Charter customers will enjoy access to a vast library of entertainment, sports, and documentaries at no extra cost.
The deal also involves Charter paying a higher fee to carry Warner Bros. Discovery’s popular linear channels, such as CNN, Food Network, and TBS. This is a significant win for Warner Bros. Discovery as it strengthens its revenue stream from cable distribution. However, fees for TNT, which will lose the NBA after the 2024-25 season, will remain flat.
In addition to the distribution of linear and streaming content, Charter will be actively involved in marketing and distributing Warner Bros. Discovery’s Max and Discovery+ streaming services. The company will also receive a share of the revenue generated from new customers they attract. This strategic partnership is expected to be a growth catalyst for Spectrum’s bundled offerings, providing an attractive value proposition to customers. The combined streaming services, including Max (Ad Lite), Discovery+, Disney+, ESPN+, Paramount+, AMC+, BET+, and Vix, offer nearly $60 per month of entertainment value, making Spectrum’s packages even more appealing.
This collaboration marks a significant step towards a more integrated future for television, blending the best of both linear and streaming options. The partnership is expected to benefit both companies financially and strategically, bolstering their market position and offering customers a more comprehensive entertainment experience.
