The Reasons Behind WB’s Gutting of HBO Max

For most of the second half of 2022, one question has been plaguing pop culture enthusiasts and those in the entertainment industry alike: Why is Warner Brothers seemingly destroying HBO Max? The massive Hollywood studio, under new leadership after a merger with Discovery, has made a series of questionable, sometimes unprecedented moves that have led many to question just what their motives and endgames are.

Industry observers first began noticing changes at Warner Brothers shortly after the company’s merger with Discovery was completed in April of 2022 and Discovery’s CEO David Zaslav took control of the newly combined company. Over the course of the next several months, several major figures in the studio’s animation department left abruptly, as did Warner Bros. Motion Picture Group chairman Toby Emmerich. Numerous projects for feature animation, HBO Max, and Cartoon Network seemed to be in a state of flux. Initially, these issues flew under the mainstream radar, mostly being discussed among film fans. That all changed in August.

On August 2, Warner Brothers announced that two major intellectual property films that were deep in post-production – The live-action DC Comics film Batgirl and the animated sequel to the Scooby Doo film Scoob! – were being shelved. Batgirl in particular came as a massive shock to many as the film was hotly anticipated by fans of the character as well as those who were excited to see Michael Keaton return to the role of Batman for the first time in three decades, which he was scheduled to do in the film.

Even the film’s directors Adil El Arbi and Bilall Fallah were shocked at the cancellation, saying in a statement:

“We are saddened and shocked by the news. We still can’t believe it. As directors, it is critical that our work be shown to audiences, and while the film was far from finished, we wish that fans all over the world would have had the opportunity to see and embrace the final film themselves. Maybe one day they will.”

Furthermore, the cancelation of the female-led film angered many since the controversial Flash film was left on the schedule, even though star Ezra Miller was and is under fire for their potential criminal behavior.

Two days later, Zaslav stated on the company’s second-quarter earnings call that while Warner Discovery had registered a net loss of $3.42 billion, they were “confident we’re on the right path to meet our strategic goals and really excel, both creatively and financially, and couldn’t be more excited about the future of our company.”

Despite that optimism, the next several months proved even more questionable for Warners. Just days after the earnings call, dozens of original series were dropped from Warner’s HBO Max streaming service with no forewarning, which angered many creators/actors/and animators who’d worked on them, leading to venting on social media. Furthermore, even more projects in various states of development were canceled. In October, the studio announced that Cartoon Network would essentially be closed and merged with Warner Bros. Animation.

So, why is Warner Brothers doing this? Well, the prevailing theory is that company sees them all as massive tax write-offs. To use the Batgirl example, attorney James M. Bandoblu, Jr explained to Newsweek “By shelving the Batgirl film, Warner Bros. will be able to reduce the loss incurred in producing Batgirl against its net income from other movies. Thus, the loss from Batgirl will reduce taxable income.”

Others have speculated that Warners may be preparing to sell the studio’s assets. However, Zaslav told employees, “We are not for sale, absolutely, not for sale. We have the strongest hand in the industry. We have everything we need to be successful to be the biggest entertainment media company in the world.” Furthermore, the company just appointed famed Guardians of the Galaxy director James Gunn and Peter Safran to revitalize the DC Comics division.

So, what’s going to be the end result of Warner Brothers’ unprecedented actions? It’ll likely take some time to find out.