HBO MAX Reels In More Subscribers Than Expected

HBO Max subscribers by quarter (YoY growth):
1) 2020-Q1 – 33.1M
2) 2021-Q1 – 44.2M (↑ 34%)

Flashback #1: Did Snyder’s Justice League Save The Day For HBO MAX?

Flashback #2: How Is HBO MAXimizing Growth?

U.S. average revenue per user (ARPU) by streaming service according to Variety:
1) Netflix – $14.25
2) HBO Max – $11.72
3) Disney+ – $4.72

Why this matters: HBO Max may be growing slower than Disney+, but it is important to remember they are charging close to 3X.

FYI: The ad-supported version of HBO Max will launch in June.

Key details for HBO Max advertising:
1) Launching in spring 2021
2) 2 minutes/hour for movies
3) 4 minutes/hour for TV shows
4) ≈ $80 CPM5) $250K quarterly commitment

Big question #1: How does this ad load compare to other offerings?

Ad minutes per hour:
1) Linear TV – 16 – 20
2) Hulu – 9
3) Digital video – 8
4) Peacock – 5
5) HBO Max – 2-4

Big question #2: Why does HBO Max want ads?

Quick answer: Advertising will increase the average revenue per user (ARPU) beyond the $15/month subscription.

Quick math on the advertising model for HBO Max:
1) Ad minutes/hour – 3
2) 30s spots/hour – 6
3) CPM $ – ≈ $80
4) $/spot – $0.08
5) Ad revenue/hour – $0.48

Dive deep: What Does HBO Max’s Launch Mean For Convergent TV?

Podcast: WarnerMedia’s CEO says that in 2022 his movies will debut in theaters before they stream

Video: WarnerMedia CEO Sees Big Year Ahead on HBO Max and in Theaters

More #1: Was ‘Zack Snyder’s Justice League’ a Hit for HBO Max? Here’s What the Data Says.

More #2: The home of the Sopranos is under siege: Inside the battle for the soul of HBO

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