The HBO-Netflix War Has Entered a New Phase

Netflix Inc. (NASDAQ:NFLX) stock plunged 7.7% on October 10 as tech stocks were routed along with the three major U.S. indexes.

Competition with the Netflix streaming service has started to heat up in 2018 with other major tech giants coming into the fray, including Amazon and Facebook. However, the heavyweight battle is still between Netflix and HBO, which is now owned by AT&T Inc. (NYSE:T).

Netflix recently acquired ABQ Studios in Albuquerque, New Mexico. The studio plans to launch as much as $1 billion in production in the state over the next decade. Albuquerque, New Mexico is perhaps best known as serving for the setting of the hit AMC series "Breaking Bad". Netflix is currently the exclusive video-on-demand provider for the Breaking Bad prequel, "Better Call Saul", which is also set in Albuquerque.

The acquisition will allow Netflix to be more flexible and aggressive in its content production going forward. ABQ Studios has nine stages and offers over 170,000 square feet.

AT&T’s WarnerMedia will launch a new streaming service in 2019 in an aim to challenge Netflix. HBO will anchor the service as a lead brand and host the entire WarnerMedia catalogue including movies, TV shows, documentaries, and animation. The service will be launched in the fourth quarter of 2019.

Walt Disney Co. (NYSE: DIS) is also set to release its streaming service in 2019. It is safe to say that the competition will become ferocious as we head into the next decade. Netflix and its competitors will be tasked with producing a greater quantity of quality content to pull in customers going forward.