WarnerMedia launched a cheaper, ad-supported version of HBO Max on Wednesday, available first in the U.S.
For the $9.99 monthly plan for HBO Max with ads, the company promises throwing up no more than four minutes of commercials per hour of streaming content. It’s priced at 33% off the regular $14.99-per-month version of HBO Max without ads.
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Also Wednesday, the company is launching one-year HBO Max pricing plans for new and returning subscribers, offering a 16% discount for those who lock in for 12 months: the ad-supported tier of HBO Max costs $99.99 per year and the zero-ads version is $149.99 per year.
Aside from commercial breaks and other ad formats, the ad-supported HBO Max version has a few other key differences from the full-price tier:
The ad-supported tier will not include the ability to download content for offline viewing.
Streaming video quality will be capped at 1080p, whereas select titles in the regular HBO Max without ads are available in 4K Ultra HD.
Warner Bros. same-day premiere films debuting in theaters and on HBO Max throughout 2021 are not included in the HBO Max ad-supported tier. However, all of those titles are slated to become available on both plans when the films debut on the streaming service in the months following their theatrical releases as part of HBO’s output deal with Warner Bros.
Otherwise, the lineup of programming is the same on HBO Max subscription tiers, which includes all content from HBO, as well as movies and shows from Warner Bros., DC, Turner Classic Movies, Cartoon Network and more. According to WarnerMedia, in the HBO Max with ads version, commercials will not play during HBO programming.
The ad-supported HBO Max is still more expensive than other AVOD packages, including Disney’s Hulu with ads ($5.99), ViacomCBS’s Paramount Plus with ads ($5.99) and NBCUniversal’s Peacock Premium with ads ($4.99).
Consumers can sign up for HBO Max plans directly from WarnerMedia at hbomax.com, via participating TV providers, or through Apple’s App Store or Google Play.
Over time, subscribers of the ad-supported tier “can expect to see greater personalization in the ads they do see,” according to WarnerMedia. “Ads on HBO Max are designed to complement and enhance the overall viewing experience and will be thoughtfully surfaced across HBO Max’s content catalog in a way that maintains the integrity of the programming.”
The company said it has inked deals with more than 35 advertisers across all major categories for the month of June, with 72 different creative spots. HBO Max with ads is launching with “frequency caps,” to ensure viewers will not see the same ad spot more than a few times, according to WarnerMedia.
HBO Max with ads will be “the most brand-safe, elegant experience for advertisers” in the industry, WarnerMedia CEO Jason Kilar said at the company’s virtual upfront last month. According to Kilar, the $10/month price point of HBO Max with ads will yield the same profit margin as the $15/month tier with no ads.
At launch, marketers will be able to buy a “brand block” of content, which will result in a “limited commercial experience” for the end viewer; WarnerMedia said it has sold two “brand block” deals to ad buyers in insurance and auto for June. Future ad formats for HBO Max With Ads include “pause ads” that show a commercial message when a user pauses content (a format Hulu offers already) and “branded discovery,” which will let marketers buy ad space within the content-discovery process on HBO Max.
The launch of the price-reduced HBO Max AVOD tier comes after AT&T announced plans to spin off WarnerMedia and merge it with Discovery, in a new company to be called “Warner Bros. Discovery.” That deal is expected to close in mid-2022.
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