Time Warner to set HBO free, launch over-the-top service

Time Warner Inc plans to go head-to-head with Netflix Inc and launch a standalone option in 2015 for popular pay TV channel HBO.

The move to take HBO Go "over-the-top" - media jargon that means consumers can watch the channel with a broadband connection - is a significant milestone for a channel long dependent on cable distributors.

HBO's top executive, Richard Plepler, announced that decision during an investor day on Wednesday where Time Warner's other top executives laid out plans to boost the company's growth.

Shares of Time Warner, also home to movie studio Warner Bros and cable network channels Turner Broadcasting, were up 2.5 percent at $72.42 in morning trade.

Netflix shares were down 3.4 percent at $434.00 after the announcement.

"In 2015 we will go beyond the wall and launch a standalone, over-the-top service with the potential to produce hundreds of millions in revenue," Plepler said, making a reference to HBO's massive hit show "Game of Thrones."

"We will use all means at our disposal to grow. This is the most exciting inflection point both domestically and internationally in the modern history of HBO."

The decision to finally free HBO - which at the moment is available only through cable, satellite and telecom operators - comes as Time Warner is under pressure to boost its share price after it rebuffed an $85 per share offer from Rupert Murdoch's Twenty-First Century Fox.

Earlier in the presentation, Time Warner Chief Executive Jeff Bewkes said the company forecast adjusted earnings per share of $6 by 2016 and $8 by 2018.