WarnerMedia, on 29th October, gave a first look at its streaming service, HBO Max, during an investor presentation at the Warner Bros Studio lot in Burbank, California.
The company has confirmed a price of $14.99 for HBO Max when it launches in the U.S. in May 2020, with a slew of newly unveiled programming highlights such as exclusive South Park rights, Greg Berlanti DC projects, all-new Looney Tunes cartoons and more.
John Stankey, WarnerMedia chief executive officer, boiled down the choice to switch to Max as an “IQ test” because “why wouldn’t you want twice the content for the same price?”
By keeping pricing consistent, AT&T-owned WarnerMedia is hoping to garner early adoption of HBO Max. The company projects the global user base of HBO Max to reach between 75 million to 90 million by 2025.
Bundling is key to drive domestic growth. As outlined in AT&T’s Monday earnings call, the telecom giant will make HBO Max available for free to premium subscribers of its TV, broadband or wireless services. The 10 million existing HBO subscribers who access the product through an AT&T service will also be able to shift to HBO Max at no extra cost.
AT&T is still in negotiations with competing pay-TV providers to make Max available to current HBO subscribers who don’t pay for the service through AT&T.
Stankey said to expect localized versions of HBO Max to hit foreign markets in 2021, adding that WarnerMedia will focus on international expansion in Europe and Latin America.
Stankey added that WarnerMedia will initially lean on licensing partners in Europe because they “provide stability and predictability” in the region, coinciding with the agreement HBO and Sky reached today to renew their output deal in the UK, Ireland, Germany, Austria and Italy.
The subscription video-on-demand service (SVOD) will have 10,000 hours of programming at launch, including Max originals, Warner Bros moves, WarnerMedia properties and HBO’s existing and future content slate.
WarnerMedia plans to introduce an ad-supported version of HBO Max at a lower price point in 2021, and it will include live programming “further down the road”.
The WarnerMedia boss also noted that international pricing for HBO Max will likely be lower than the US product and vary market-to-market, so the “nature of the offering will be scaled down”.
In general, AT&T is moving forward with a “software-based entertainment” strategy, Stankey said. The goal is to eventually bring AT&T Now and HBO Max seamlessly together on a single platform.
“[You’re] not going to [be able to] distinguish between AVOD, SVOD and live pay-TV,” said Stankey. “We’re going to see over time that that just comes together in one universal platform, and I think that’s generally where the market is going.”
