WarnerMedia ad chief sees ‘droves’ of consumers choose HBO Max with ads

WarnerMedia is still less than a year out from its launch of ad-supported HBO Max but the company said it’s already seeing substantial interest from subscribers.

JP Colaco, vice president of advertising sales at WarnerMedia, spoke this week at the TV of Tomorrow Show and provided some color around HBO Max with ads. He declined to breakout totals for ad-free and ad-supported HBO Max subscribers but he did say that subscriber numbers for the less-expensive tier are moving “up and to the right.”

“We feel really excited about the growth of HBO Max with ads, and that’s a function of the fact that we are giving people choice. I think if you give consumers choice, you will get more of them to sign up for your service. So, we’re delighted by that,” he said.

Colaco also gave a view of how WarnerMedia approaches ad loads on HBO Max. He said the company tries to maintain the “lightest ad load in the AVOD community,” which for now comes out to fewer than four minutes per hour of content viewed on HBO Max.

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“It’s a great deal for consumers because right now, the HBO content does not have ads even if you’re on the ad-supported service, so our actual effective ad load is even less than that,” he said. “It’s a great bargain for consumers and we’re seeing them sign up in droves.”

The HBO Max ad-supported tier launched in June at $9.99 per month, compared with the $14.99 per month price tag for the ad-free experience.

The lower price means HBO Max with ads subscribers don’t get access to 4K video, with resolution be capped at 1080p, and can’t download content for offline viewing. Last year it also meant that Warner Bros. same-day premiere films debuting in theaters and on HBO Max were not included in the HBO Max ad-supported tier, but still become available on both tier options when the films debut via the HBO service in the months following their theatrical releases as part of HBO’s output deal with Warner Bros.

At launch, more than 35 brands signed on for advertising on HBO Max and at the time, the company said it had 72 creatives housed for campaigns with frequency caps set to encourage greater variation of creative and formats.

“Advertising is a time-tested way to reduce the cost of great entertainment and reach a wider audience,” said Andy Forssell, executive vice president and general manager of HBO Max, in a statement. “We’ve worked hard to create an elegant, tasteful ad experience that is respectful of great storytelling for those users who choose it, and which we’re confident will deliver for our advertising partners as well.”