WarnerMedia plans to launch an ad-supported HBO Max tier in June 2021, providing a cheaper alternative to the service’s $15 a month ad-free plan. The media giant expects to bolster its HBO Max subscriber count with the ad-supported plan, though it hasn’t announced a price or exact launch date.
After its 2019 launch, WarnerMedia told investors that HBO Max would have 50 million subscribers by the end of 2020. But the service ended last year with around 41 million subscribers, likely due to the service’s confusing name and high price. If it weren’t for the COVID-19 pandemic, which significantly increased streaming demand, the service could have ended 2020 even further from its 50 million goal.
At a recent Goldman Sachs conference, WarnerMedia CEO Jason Kilar explained that “most people on this planet are not wealthy,” so in order to gain more subscribers, HBO Max needs to offer a cheaper, ad-supported plan. The company expects its ad-supported plan to drive its subscriber count to at least 67 million people by the end of 2021, and 150 million by 2025.
But an ad-supported HBO Max membership could look a lot different from an ad-supported Hulu plan. As reported by The Streamable, a WarnerMedia survey conducted last year hints that HBO won’t run ads on around 50% of its content, and that the platform may only run two to four minutes of ads for every hour of viewing. Still, ad-supported HBO Max subscribers may miss out on same-day theatrical releases, according to AT&T’s March 12th analyst call.
Of course, there’s no guarantee that HBO Max’s ad-supported plan will be so loose. The only thing we know is that the platform’s incoming tier will cost less than the standard $15 a month membership, and that the big wigs inside WarnerMedia are very excited for its launch.
Source: WarnerMedia via The Streamable, Bloomberg