HBO NOW’s streaming service surpasses 2 million subscribers

HBO’s streaming service for cord cutters, HBO NOW, has grown to over 2 million subscribers in the U.S., parent company Time Warner announced on Wednesday, as part of the company’s quarterly earnings. The service, which launched in April 2015, reached 800,000 subscribers by the end of its first year, and by March 2016 was nearing 1 million subscribers.

Variety was first to note the new subscriber numbers, noting also that Time Warner’s streaming service can help HBO with its upcoming carriage deals, like the one with Charter Communications, because cable companies know that today’s consumers have other options for watching the premium channel’s programming.

HBO NOW’s growth has been closely tracked since its debut as example of how a business so dependent on pay TV subscriptions could transition and thrive in the cord-cutting era. Initially, there was some concern that the service was off to a weak start, leading to questions about its higher price point – $15 per month, compared with much cheaper streaming options from Netflix and Hulu.

But HBO CEO Richard Plepler said last year the service still had plenty of room to grow, given it had yet to launch some of its more anticipated content, like Jon Stewart, Bill Simmons, and the Vice daily news show. HBO NOW had also not rolled out to all platforms as of early last year, which limited its reach.

Time Warner CFO Howard Averill this week attributed the streaming service’s growth to its digital distribution deals, Variety reported, saying that HBO “has seen a nice uptick in OTT subscriber growth recently.”

Today, there are a number of ways to subscribe to HBO without having to pay for a cable TV subscription, including through streaming TV services like PlayStation Vue, Dish’s Sling TV, and AT&T’s DirecTV NOW. Soon, Hulu will launch its own live TV service, which also reportedly includes an option to add on HBO. (Hulu hasn’t formally announced the live TV service’s line-up. However, Time Warner took a 10 percent stake in Hulu this August, so it would be surprising if the line-up didn’t include an HBO option.)

It’s been clear for some time that HBO NOW’s adoption has been climbing, given that its mobile application became one of last year’s top apps by revenue. This success is likely due to a combination of factors, including expanded cross-platform support, more ways to subscribe, and HBO’s content, which has included new hits, like “Westworld.” That show alone is averaging over 13 million views per episode, which is the most for a first-year show in HBO history. HBO also received 22 Emmy nominations in 2016 for its content, like the still-popular “Game of Thrones.”

All this translated to a strong quarter for HBO, which saw revenues up by 5.6 percent to $1.49 billion.