HBO (S TWX) has long said that it has no plans to sell subscriptions directly over the internet, but Netflix (s NFLX) CFO David Wells suggested Wednesday at a Goldman Sachs conference that the cable channel should rethink that decision. “We believe that if they were direct-to-consumer, there would be materially more subscribers that would pay for it in the U.S.,” Wells said.
Wells made that suggestion when asked about Netflix’s addressable domestic market, which he said was between 60 million and 90 million subscribers — a number that is just slightly below the roughly 100 million households that pay for TV services in the U.S. Netflix has made these estimates before — but this was the first time that an executive suggested that these numbers could be within reach for HBO as well if it decided to embrace standalone subscriptions.
HBO currently has around 28 million subscribers in the U.S, while Netflix came close to 30 million domestic subscribers in its most recent quarter. There have been a lot of discussions about HBO possibly offering online subscriptions without the need to subscribe to cable in the past, but the network has consistently said that it is not interested in that kind of distribution model.
Asked about why more people haven’t subscribed to Netflix yet, Wells said that not having connected devices could be one factor. But often, it comes down to something a lot simpler: “Folks just find it that valuable,” he said.
Netflix’s challenge here is that people may have subscribed in the past when the content offering wasn’t that great, which is why the company is now putting a lot more emphasis on showcasing its content in its marketing efforts.