HBO Max Seeking Options to Retain AVOD, SVOD Subscribers

Customer choice is driving subscription and release strategies at HBO Max, said Jason Press, WarnerMedia global executive vice president-direct-to-consumer technology and program management, on a virtual Streaming Media event Tuesday. WarnerMedia continues to experiment with "the right strategy at the right time" after last year releasing feature films theatrically and on HBO Max simultaneously amid COVID-19 theater closures.

For 2022, WarnerMedia has gone to a 45-day theatrical window before releasing films on HBO Max, said Press. Last year’s “unique circumstances” forced the company “to build out new capabilities,” he said. In addition to the 45-day window, HBO Max is creating 10 exclusive Warner “blockbuster” movies for day-and-date release, he said. It has been working on those releases for 15 months, he said, promising "theatrical-quality" content with “big-time directors, actors and producers."

The pandemic limited creators’ ability to have their content seen, and the expansion of exclusive content on HBO Max widened creators' opportunities, he said: “It’s a great time to be in the creative community.” HBO Max will experiment more with live events in 2022, Press said.

Commenting on HBO’s decision to launch an ad-supported tier, Press said the company made the choice not to put advertising in front of HBO content, or Warner theatrical releases, in 2021. With its roots as a commercial-free content subscription VOD service, it was important in the ad-supported offering to make ads feel like they’re “part of the experience,” Press said. Its ad load is lighter than those of competitors in equivalent tiers, he said.

The HBO Max service isn’t fully automated with ad insertion, said Press. It’s important to create the ad insertion splice points “at the right time, where it’s not going to interrupt the experience," he said. "You don’t want to be mid-dialogue, for example. You want to be in a place where it’s a great breaking point between scene changes.”

HBO doesn’t try to upsell subscribers to the higher priced plan, Press said. It doesn't look upon switching between AVOD and SVOD as "an upgrade or a downgrade," he said. "It’s just a different choice the customer is making in terms of how they want to consume the content.”

On how HBO Max addresses short-term AVOD customers who binge a show and then leave the service, Press said the company’s first strategy is to release “world-class content” every month. Avoiding the release of all the content at once can reduce bingeing, he said. “We have a cadence, and it takes folks across one or two or three successive months,” depending on the series, to take in all the content, he said. The service also makes recommendations about similar content subscribers they might like to further engage them, he said: “We personalize the experience."

HBO Max moved away from free trials, Press said. “From a subscriber acquisition retention standpoint, we do better with our service and our commerce capabilities when we’re not offering that free trial binge and dumping of the service.” When the service draws customers to the first season of a new show, “we then have the rest of that time to put in front of those customers personalized experiences” where they can see the full slate of programming available, he said.