HBO Max Announces When It Will Debut, Pricing and Other New Details

AT&T aims to have as many as 90 million global subscribers by 2025

HBO Max announcement
HBO Max will debut in May 2020 with 10,000 hours of content.

HBO Max, AT&T’s foray into a crowded and competitive streaming television market, will come onto the scene in May 2020, and the service will cost $14.99 a month—the same price HBO subscribers are currently paying for that service.

The news, which was announced Tuesday at a WarnerMedia investor day in Burbank, Calif., means the streaming service will cost the same as a subscription to HBO’s existing cable service. And the May premiere date will leave HBO Max having to play catchup not just with Disney+, which is expected to be a formidable rival when it premieres Nov. 12, but also with NBCUniversal’s rival streaming service Peacock, which is slated to debut in April.

HBO Max’s price point will likely aid in AT&T’s task of building scale for its upcoming streaming service in an increasingly crowded streaming television space. Existing HBO subscribers, which in the U.S. number around 34 million, will be encouraged to make the switch to the new service, and the 10 million HBO subscribers who are AT&T cable customers will be able to make the switch for free, said Tony Goncalves, the CEO of Otter Media who has been heading up the development of the direct-to-consumer product.

Customers who buy HBO through other cable providers may not be able to make the switch as seamlessly, as AT&T is still in discussions with other providers to allow for HBO Max access. However, the company expects other cable and satellite providers to agree to give their current HBO subscribers access to HBO Max. After all, “distributors would like to keep customers engaged on their platforms and not others,” WarnerMedia CEO John Stankey said.

The hope is to scale up HBO Max’s audience as fast as possible, which AT&T will do by converting existing HBO subscribers into Max customers. To entice new subscribers, AT&T customers will be offered bundles that include HBO Max for no additional charge, Goncalves said.

In the U.S., AT&T is aiming to have 36 million HBO Max subscribers, including HBO’s existing subscriber base. It estimates it will add an additional 2 million subscribers in 2021, when it rolls out an ad-supported offering. The company hopes to increase that rate of growth by 3 million a year in subsequent years. By 2025, AT&T anticipates HBO Max will have 50 million U.S. subscribers, Stankey said.

Internationally, HBO Max is targeting expansion into Latin American and European markets where HBO already has a foothold. By 2025, Stankey said, the company aims to have between 75 million and 90 million HBO Max subscribers around the world.

The company will not do away with HBO’s existing direct-to-consumer streaming offering, HBO Now, or its streaming service for HBO cable customers, HBO Go, but it will encourage those audiences to migrate to the HBO Max app, Goncalves said.

While HBO Max isn’t in the $17 range that had previously been speculated, it is still slightly higher than Netflix’s standard $12.99 streaming package and Hulu’s $11.99 ad-free option as well as newer entrants in the streaming space like Disney+ and Apple TV+, which will cost $6.99 a month and $4.99 a month, respectively.

Details around the streaming service have been highly anticipated even before AT&T CEO Randall Stephenson on Monday positioned the service as the cornerstone of the company’s “streamlined and simplified” streaming video product offering. AT&T, which last year acquired Time Warner (which has now been renamed WarnerMedia) for $85 billion, is under pressure from shareholders and an activist investor group to prove the value of the acquisition, and the company rolled out a three-year plan Monday that heavily featured the anticipated growth of HBO Max once it comes onto the scene.

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