HBO’s planned launch of a standalone, over-the-top (OTT) streaming service is on track for 2015, but apparently there has been major kerfluffle inside the premium network’s C-suite over how best to support it—resulting in the exit of HBO CTO Otto Berkes.
HBO had been building its own streaming video technology platform, codenamed “Maui,” largely by the directive of Berkes. The company has now scrapped the project, citing cost overruns and other headaches, leading Berkes to resign in what reads like a fit of pique:
“Recently HBO’s management decided to partner with a third party to assist HBO in bringing our OTT service to market in 2015,” Berkes wrote in a memo to HBO staff obtained by Variety. “This is a change in direction from what I planned with HBO and the approach will not utilize my overall capabilities. Therefore, I feel that this is the right time for me to move on from HBO so that I am able to fully pursue my passion building world-class technology teams, products and businesses.”
Berkes has been a polarizing figure inside HBO from the beginning. He joined HBO as senior vice president of digital products in 2011, coming from Microsoft (News - Alert), where he helped develop the Xbox. In 2012, he was promoted to CTO, and proceeded to build an office in Seattle with 55 engineers, rumored to cost as much as $100 million per year. Further, he brought in several ex-colleagues from Microsoft while laying off a number of longtime employees in New York. According to Fortune, insiders have accused Berkes of building “a Napoleonic empire” within HBO.
Reports have noted that one of his most adored initiatives was Maui, which was meant to give HBO more autonomy and control over its service, while providing a potential revenue stream via licensing. But, the system was a “less-than-perfect solution” according to execs. So, in the interest of time-to-market, HBO decided to go with MLB (News - Alert) Advanced as its technology provider for the OTT service.
“Maui’s timeframe caused us to make concessions both in scope and culture,” said Mark Thomas, senior vice president of technology program management, and Drew Angeloff, senior vice president of digital products, in a company memo. “We look forward to returning to teams defining scope, and consumer experiences, without forced top-down scheduling.”
He added, “This was not a judgment of the team’s work quality or deliverables but rather a bet that an existing streaming service could deliver the needed product faster and at lower risk than Maui.”
MLB Advanced has its chops: it operates the MLB.tv subscription streaming service for out-of-market baseball games, and has supported other clients like the WWE Network, CBS and ESPN (News - Alert).
And all is not lost for the in-house tech: a “large portion” of Maui can be repurposed for the HBO Go TV Everywhere app, according to the memo.
HBO plans to launch the standalone streaming service to coincide with the Game of Thrones season premiere in April.