A cheaper HBO Max tier is still coming, according to AT&T’s John Stankey. However, it is unlikely to be offered anytime soon, leaving consumers interested in trying out HBO Max no option other than paying $14.99 per month or opting for an AT&T service that includes HBO Max as a bundled feature.
HBO Max launched on May 27 after a long time in development. The service is one many are now watching as it represents a major play by AT&T and WarnerMedia. Not only does HBO Max offer access to the variety of content included with a standard HBO subscription, but it also adds content pulled from WarnerMedia’s other popular brands. All in all, it’s a lot of content, but for a lot of money for a single subscription.
In comments given to CNBC during a Squawk Box interview, President and COO of AT&T, and soon to be CEO, John Stankey confirmed the goal remains a more affordable HBO Max tier. This is an aspect that has been teased before and while no further details were given in the interview, Stankey once again continued to tease the idea, suggesting the cheaper HBO Max package won’t arrive until early 2021.
Ad-supported HBO Max is good for AT&T
The suggestion AT&T is intent on adding an ad-supported tier to HBO Max is to be expected. Over the last couple of years, the use and interest in the AVOD model has risen dramatically. For example, Comcast, Fox, and ViacomCBS have all purchased entire AVOD services that have proved they can make the model work, and turn a profit. While AT&T won’t be offering a true AVOD service – due to it adopting a hybrid model where consumers still have to pay a subscription cost – if a cheaper version can attract new subscribers, then the company will want to make sure a cheaper plan is available.
In practical terms, an ad-supported version of HBO Max is likely to work along the same lines of what Hulu currently offers with its on-demand subscription service. For example, Hulu offers an ad-free experience similar to the current version of HBO Max, priced at $11.99 per month. However, the ad-supported version of Hulu sees the price drop down to $5.99 per month. While this does require the subscriber to endure ads during content, that’s a substantial difference in financial cost to the consumer.
Whether or not HBO Max offers the same sort of discount remains to be seen, although any reduction in price is likely to help more than it hurts the service.
AT&T is also a company that places great value on ads in general. That is, personalized ads served to consumers based on collected viewer data. This is another added reason why AT&T specifically, will see value in an ad-supported version of HBO Max, beyond the additional subscribers it could bring in.