HBO Max launches price drop promotion to boost subscriber numbers ahead of Q3 earnings

WarnerMedia has launched a promotion for stuttering SVOD HBO Max as it approaches the end of Q3.

From September 4-25, new and returning subscribers “whose accounts have lapsed” (read: people who didn’t stick around after the initial free trial) will be offered the service for US$11.99 for 12 months, down from the sticker price of US$14.99. This will save subscribers US$36 over the course of a year.

The move is not unprecedented – Warner offered the same discount as a pre-launch special – but it does signify that the media giant is not happy with the streamer’s performance to date.

At the end of Q2, after only a few weeks of availability, HBO Max was at four million users, though a quarter of that total gained access via their subscription to the HBO linear channel.

AT&T CEO John Stankey at the time said that “one month after launch, HBO Max had about three million retail subscribers, and 4.1 million subscribers had activated their Max account. Of those, more than one million were wholesale subscribers through AT&T.”

There have been a number of barriers to entry for HBO Max which have hampered its progress to date.

Analysts slammed the streamer for having a “chaotic launch”, due to the combination of its high pricing (Netflix’s standard tier, by contrast, is US$12.99 per month); its branding which confusingly sets it up as a complement to HBO Now and HBO Go rather than a replacement; and lack of accessibility.

The latter point is one which has seen little progress, with the conglomerate seemingly at an impasse with Amazon and Roku over launching the app on their platforms. Both device makers want HBO Max to sit within their respective Channel sections, but Warner believes this to be a double standard with the rule not enforced on the likes of Disney+ and Netflix.

Users have also criticised the service for not providing support for 4K UHD viewing, particularly as many shows such as Game of Thrones and Westworld were transmitted as such on HBO’s linear network and are available in this format in physical media.

Despite these setbacks, AT&T is all-in on HBO Max, and recently reshuffled WarnerMedia around the streamer under Hulu co-founder Jason Kilar – a reshuffle which resulted in the departures of HBO Max’s two driving forces Bob Greenblatt and Kevin Reilly and 600 other staff.

AT&T is also heavily indebted and is looking to recoup much of its recent losses with fire sale of its non-essential assets, including being rid of the Xandr ad sales business which has failed to keep pace with industry trends since its 2018 inception.