AT&T (NYSE:T) launched HBO Max last week with a couple big missing pieces: You can't watch it on Roku (NASDAQ:ROKU) devices or Amazon's (NASDAQ:AMZN) Fire TV products. Considering the two combine to account for about 70% of installed connected-TV streaming devices in the United States (and growing), that's a pretty big hole in the service's launch.

CEO of AT&T's Otter Media division, Tony Goncalves, explained the dispute between HBO Max and Roku and Amazon in an interview with The Verge. Goncalves and HBO want similar deals to the agreements the company has in place with Apple (NASDAQ:AAPL) and Alphabet's Google. He also pointed to Amazon's and Roku's arrangements with Netflix (NASDAQ:NFLX) and Disney (NYSE:DIS) as examples of deals the platforms have made with big streaming services in the past.

The HBO Max logo

Image source: AT&T.

"Pretty standard" deals are off the table

"There's a pretty standard way of bringing these apps to market on these platforms. That's what we're focused on doing," Goncalves said in the interview. But Goncalves also admitted to having no insight into Amazon or Roku's arrangements with Netflix or Disney, which were probably not standard deals.

Disney and Amazon had a long standoff, only finalizing a deal at the last minute. Part of the dispute was about Amazon's share of ad inventory in Disney's ad-supported streaming apps. Considering WarnerMedia also has ad-supported streaming apps -- TV Everywhere apps for its cable networks -- that may be part of the negotiations, too. 

Adding another layer to the challenge is that both Amazon and Roku have existing wholesale agreements with HBO to distribute the network through Prime Channels and The Roku Channel, respectively. HBO doesn't seem keen on continuing those relationships. It notably removed HBO subscriptions from Apple TV Channels as part of its deal for HBO Max on Apple.

But those wholesale agreements are very important to Amazon and Roku. Amazon pointed out in a press release that nearly 5 million HBO subscribers pay through Amazon. And those subscriptions are a selling point of Amazon's Prime membership, a pillar of its business. While Roku's subscriber base isn't nearly as large (it only started selling subscriptions at the start of 2019), premium subscriptions in The Roku Channel are a key initiative in one of the cornerstones of its platform business.

WarnerMedia's relationships with Amazon and Roku are too entangled at this point to demand a standard deal. It's also worth noting AT&T is one of the largest pay-TV distributors in the United States. Roku and Amazon, therefore, have opposing interests to those of AT&T when it comes to how consumers pay for and watch television, further complicating negotiations.

Moreover, Amazon and Roku have enough leverage to fight back against media companies demanding terms they find unfavorable. While Google and Apple control practically 100% of the smartphone market, most video streaming takes place on TVs in the United States. That makes Roku and Amazon extremely important -- likely more important than Apple and Google -- to the ability of a streaming service to provide value to its subscribers. Both have become increasingly aggressive in negotiations over the past year as they've consolidated power.

HBO Max isn't Netflix, and it's not Disney+

Goncalves oddly points out that Amazon and Roku made deals with Disney+ and Netflix to distribute their services. "There's a certain business model that exists. We just want the same one," he said.

There's no reason for Roku or Amazon to treat HBO Max like Netflix. Roku was developed inside Netflix and the two have partnered practically since Netflix started streaming. When Fire TV launched in 2014, there was no way Amazon could attract a user base without a deal with Netflix. Now both have substantial user bases and HBO Max isn't a make-or-break piece of attracting or retaining most users.

Disney did an excellent job building the Disney+ brand ahead of its launch and clarifying its message to consumers. As a result, there was significant demand for the service, and that was evident well ahead of its arrival. By comparison, HBO Max has been relatively quiet in terms of marketing. The results speak for themselves: Disney+ had about 30 million U.S. subscribers within six months of its debut.

HBO points to a similar number of subscribers for HBO Max -- 30 million. But those subscribers primarily exist through pay-TV distributors. That's not pent-up demand for HBO Max like we saw for Disney+. It's preexisting demand for HBO (which is still available on Roku and Fire TV, by the way). HBO Max simply isn't as strong of a brand as Disney+.

As a reminder, AT&T committed $4 billion to HBO Max over the next three years, and a big part of recouping that investment is growing the subscriber base. That's not going to happen if users can't watch the service on their preferred streaming platform.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.