http://www.multichannel.com/news/news-articles/plepler-hbo-ott-won-t-cannibalize-cable-subs/384773 Plepler: HBO OTT Won’t Cannibalize Cable Subs Home Box Office chairman and CEO Richard Plepler said plans to launch an over-the-top version of the premium channel next year won’t cannibalize existing pay TV customers, adding that the company will initially target the estimated 10 million broadband only subscribers across the country. Speculation that HBO would offer an over-the-top version has been around for months and one of the concerns is that it would give younger, tech-savvy and cost-conscious consumer another excuse to cut the pay TV cord. Plepler said the initial focus will be on broadband only customers – which HBO will go after with their pay TV partners. But he earlier said the ultimate market for the service is the 80 million homes that don’t subscribe to HBO, many of whom have a pay TV subscription. Plepler said he has spoken to almost every distribution CEO about HBO’s plans, adding that they see the service as a “lean into” opportunity. He added that 85% of Netflix subscribers are multichannel video programming distributor subscribers too. “I don’t think this is an either or,” Plepler said of the planned service. “The great preponderance of this is additive.” Distributors for the most part kept their feelings on the issue close to the vest. Charter, Time Warner Cable, DirecTV and Dish Network declined to comment on HBO’s over-the-top plans, while Comcast and Cablevision didn’t respond immediately to a request for comment. Others used the opportunity to reiterate their commitment to providing access to the content their customers want. “We’re focused on helping customers connect to the things they care about, in the ways they prefer, and we will continue to work with our content partners to develop multiple options and packages that accomplish that,” said Cox Communications spokesman Todd Smith in a statement. He added that the company had no comment at this time about the pending HBO offer. But at least one operator believes HBO over the top will be an opportunity. Mediacom Communications vice president of legal and public affairs Tom Larsen said in an interview that an HBO over the top service should have minimal impact on the company. Larsen said that customers that would be likely to drop their cable connection an instead subscribe to an over-the-top HBO service include tech-savvy young people and price-conscious consumers, “who aren’t HBO subscribers anyway.” Pricing of the service will be an issue. HBO can cost as much as $22 per month depending on the distributor and the package. Larsen said he did not expect HBO to price an OTT service dramatically lower than what MVPDs are charging. Larsen said the service could be an added benefit for cable customers in that they will need a reliable high-speed data service to access the HBO product. “I really do think that Netflix strengthens a need for a good broadband connection,” Larsen said. “With an HBO over-the-top product, you’re going to have to have pretty strong broadband speeds to support it. It could encourage folks to upgrade to higher speeds. They can go from 3 Mbps to 15 Mbps, from 15 Mbps to 50 Mbps. It could get them to buy better products from us that make more money for us and we don’t have a significant programming expense.” One distributor who asked not to be named said that the possiblity of an HBO over the top service has been part of regular carriage negotiations for years, so the announcement comes as no surprise. And, the person added, most-favored-nation clauses with some distributors could limit HBO's pricing flexibility for the OTT offering. Time Warner stock was up on the news – it traded as high as $73.70 on Wednesday morning (up 4.3% or $3.06 each), before slipping slightly to $72.57 (up $1.93 each or 2.7%) later in the afternoon. Netflix shares, down as much as $19.06 each (4.2%)to $430.18 each in the morning, fared a little better in the afternoon as the stock was priced at $437.69, down 2.5% or $11.34 per share.