HBO Max Viewers Can Skip Opening Credits in Break From Tradition
(Bloomberg) -- This won’t be your parents’ HBO.
Subscribers to HBO Max, the new streaming service that AT&T Inc. launches on May 27, may soon be able to click past the opening credits when shows start. For fans who binge watch all eight seasons of “Game of Thrones,” one of the network’s most-popular programs, that’s a two-hour savings.
The telecom giant needs to get in step with consumer preferences. The ability to skip credits, scenes from previous episodes or promotions for other shows has been a feature at Netflix Inc. for a couple of years. Not being able to do so is a drag for HBO subscribers who don’t want to listen to “The Sopranos” theme every time they watch an episode.
“That’s where we are going,” said Andy Forssell, general manager of WarnerMedia’s direct-to-consumer business, who has a clock in his home office counting down the hours and minutes to launch. “We’re not precious about it.”
While all of the features might not be available at first, the changes show AT&T is trying to adapt to the era of on-demand TV as it launches the biggest gamble since its $85 billion purchase of entertainment giant Time Warner Inc. two years ago. In October, AT&T outlined plans to spend as much as $2 billion this year to launch HBO Max, which it hopes will bring in millions of more subscribers globally.
But it had to change those plans quickly after the coronavirus shut down TV production and locked people in their homes. At one point, AT&T President John Stankey questioned whether HBO Max would be ready on schedule.
“It took us not even a day to say, ‘Yes, we have everything,’” Sarah Aubrey, the head of original programming for HBO Max, said in an interview. “We have our launch slate. We’re ready.”
The new service is an attempt to meld the existing brand, one of the best-known in television, with a product that potentially appeals to a larger audience. Subscribers will get access to the full library of HBO shows, from “The Sopranos” to “Veep,” as well as classic movies from the Warner Bros. catalog. It will also include shows the Warner studios produced for others, such as “Friends” and “The Big Bang Theory,” and original programming. There’s even a long-awaited director’s cut of the DC superhero film “Justice League” coming next year.
“We think we can really broaden the entire platform out, to begin at young kids all the way through the adult demos, so we have something great for everyone,” said Bob Greenblatt, chairman of WarnerMedia.
HBO Max is being offered directly to consumers for $14.99 a month. Subscribers who already get HBO through a cable provider can sign up for the expanded service at no added cost. Some premium AT&T customers will get the service for free.
Greenblatt said AT&T has reached deals to offer HBO Max through many major pay-TV providers and app stores. But it has yet to sign Roku Inc. or Amazon.com Inc., two of the largest makers of digital-media players, or Comcast Corp., the biggest cable TV service. AT&T isn’t asking distributors to pay any more for the service, even though it features more content. Greenblatt expects consumers to sign up in several ways, from traditional distributors to direct subscriptions.
Among the many features, the service will have celebrities and others recommending shows, and allow families to track their viewing in groups so they can discover programs that may appeal to them collectively. The company is even considering a lower-cost version with ads — potentially a big departure for HBO.
AT&T has the advantage of launching with 34 million HBO subscribers already in the U.S., and has set the relatively modest goal of reaching 50 million domestic customers by 2025. But the company is a little late to the streaming party, entering a crowded field that includes the industry leader Netflix, Walt Disney Co.’s Hulu and Amazon’s Prime Video, along with newcomers like Disney+ and Peacock, from Comcast’s NBCUniversal.
WarnerMedia executives must navigate the terrain carefully. Their target audience will be much broader than HBO’s typical viewer: a fan of adult dramas. It will include more kids, with new programming from Looney Tunes and DC Comics. HBO Max programmers are also buying more international shows and commissioning adult-oriented animated series.
Some old habits won’t die. WarnerMedia executives still plan to release most new programs on a weekly basis, one episode at a time, rather than the all-at-once format favored by binge-watchers. But the HBO executives have had to pivot in other ways.
With the coronavirus shutting down TV production, the HBO Max team had to look for other ways to keep the content pipeline full. They bought “An American Pickle,” a completed Seth Rogen comedy that Sony Corp. decided not to release in theaters. The executives are also talking to their colleagues at Warner Bros. about taking over production of some films for a new label, Warner Max, that will make movies for the service.
HBO Max also commissioned a new show from former Disney Channel star Selena Gomez about her learning to cook under lockdown at home. “Selena’s set is very contained,” said Aubrey, the content chief. “They’re going to shoot them all back to back.”
Indeed, the pandemic, which has paused production industrywide, could last until the fall, the executives said. Negotiations with entertainment unions about restarting are complicated, and HBO, with shows that often feature large casts in multiple cities or countries, is especially complex.
WarnerMedia executives were just about to amp up their marketing for the new service in February when the virus hit. The original idea was to promote HBO Max heavily on the company’s traditional TV channels, including the college basketball finals on TBS. With live sports canceled and people cooped up at home, more of the marketing budget shifted online.
Still, some traditional ad buys couldn’t be pulled. Greenblatt recently spotted an HBO Max billboard on a near-empty Sunset Boulevard in Los Angeles, deserted but for a couple of people on a corner. He snapped a photo and sent it to the network’s head of marketing.
“At least we got two impressions on this,” he said.
©2020 Bloomberg L.P.