Netflix doesn't want to turn HBO into Netflix — it wants to bundle it

• Netflix became HBO faster than HBO could become Netflix.
• That's why Netflix is buying HBO.
• But assume the deal goes through, does HBO stick around, or get merged into Netflix? I have some thoughts.

Last month, HBO boss Casey Bloys stood in front of an auditorium full of reporters and told them what everyone already knew: Netflix had won the streaming wars.

"To Netflix's credit, as the first mover, they have become a utility. For consumers, it is the basic cable of today," he said.

But Bloys wasn't surrendering — he was pitching: HBO was still valuable, just like it was in the old cable days, when the only way you could get HBO was to get basic cable as well. "In today's world, consumers still want to add to their entertainment portfolio," he said.

Translation: OK, we know you're getting Netflix. But you should also buy HBO, too.

Now Netflix wants to take that idea to its logical conclusion: It will sell you Netflix and HBO.

First, of course, Netflix has to actually close its blockbuster $83 billion deal for HBO and the Warner studio.

But when that's done, what happens next? Netflix executives got a bunch of questions on an investor call Friday along those lines — both for HBO and the studio — and their answers on the HBO end amounted to "We think HBO is very valuable," which doesn't really clear anything up.

But the most logical way this would play out would be something like this: Netflix continues to offer the service now called HBO Max to anyone who wants it — whether or not they subscribe to Netflix — and then offers it to Netflix customers at a discount. A real bundle. A Netflix version of "basic cable + HBO."

Again, Netflix executives didn't actually say that on the call. Instead, we got commentary like this, from co-CEO Greg Peters:

"We think the HBO brand is very powerful for consumers. We think that the offering could constitute and would constitute part of our plans and how we structure those for consumers. And then that gives us a lot of options to figure out how do you package things, in different ways to make sure that we're maximizing the value for consumers , and maximizing the value of the assets that we're then being able to present."

Shrug emoji.

I'm sure Netflix will consider some tweaks beyond simply running two different services at the same time and selling a discounted bundle.

For instance: what happens to the "Max" shows HBO Max has been making — the cheaper, high-volume series that were supposed to broaden HBO's audience? Do those migrate to Netflix, which already serves a much larger, more general-interest subscriber base?

But those are tweaks. The big picture is that Netflix could operate Netflix and HBO as two separate services for quite a while, sold to overlapping but distinct audiences. Which is basically how things already work. Netflix declined to comment.

What's the opportunity for Netflix, and for HBO?

Antenna, the analytics firm, estimates that 45% of HBO's US subscribers already have Netflix — but only 15% of Netflix subscribers also get HBO. That discrepancy is likely even wider outside the US, since Netflix is nearly global and HBO is still expanding internationally. Which means HBO could dramatically increase its reach simply by being attached to Netflix and its 300 million subscribers.

It's also worth remembering the original logic behind Warner Bros. Discovery — the 2022 mashup of what used to be called Time Warner and Discovery Inc. The whole idea was scale: Put Discovery's cheap basic-cable fare in the same container as HBO's prestige hits, and you'd have one super-service that lots of people would buy.

Didn't work. HBO viewers wanted "The White Lotus," not pimple-popping shows. And investors hated the amalgamation so much that WBD was preparing to break itself up before deciding instead to sell to Netflix.

So I'd be surprised if Netflix tries melting HBO into part of its giant, undifferentiated service. Much more likely: Turning it back into what it's always been: a premium channel you stack on top of whatever you already watch.

That used to be cable. Now it might just be Netflix.