HBO Max Is Here. Will It Work?

HBO Max has everything a streamer needs to play on the big stage in 2020: a massive catalog of recognizable content, a slate of high-profile originals, a global tech infrastructure, a big marketing machine. When HBO Max launches Wednesday, it will have a check mark in all of those boxes — and something extra.

The something extra for HBO Max is HBO, which has a sterling reputation for quality programming, a warehouse full of Emmys, and 34 million U.S. subscribers. HBO Max includes the entirety of HBO, and the pitch to current HBO is that you get significantly more content for the same $15 a month. The launch tagline — “HBO Max: Where HBO Meets So Much More” — is aimed squarely at those subscribers.

“In the era of Amazon, Apple, Google and Netflix, scale is no longer defined by distribution to a quarter of U.S. consumers,” John Stankey, the incoming CEO of HBO Max owner AT&T said at an investors event last October. “HBO Max — with its brand promise and on-demand content for everyone — will be the lead product in our drive to establish an initial customer relationship in most U.S. households.”

HBO Max’s modest goal of growing 34 million U.S. HBO subscribers to 50 million U.S. HBO Max subscribers in 2025 will be helped by a lower-cost, ad-supported tier in 2021. With the quickening collapse of the cable bundle, HBO Max could soon become the primary outlet for CNN and live sports like March Madness and the NBA.

Here’s a look at how HBO Max stacks up for current HBO subscribers, new subscribers and what the service means for owner AT&T.

Will HBO Max Work for HBO Subscribers?

If you’re among the 34 million U.S. households who have HBO, you’re likely watching some combination of HBO’s big-budget spectacles (Westworld, Watchmen), prestige dramas (Succession, The Outsider), comedies (Insecure, Barry), unscripted (Last Week Tonight, We’re Here), original films (Brexit, Bad Education), and recent feature films (Joker, Good Boys).

The rationale for upgrading from HBO to HBO Max is easy: It’s more stuff for the same cost. HBO Max will include everything you get now from HBO, plus a catalog of 10,000 hours of movies (Casablanca, Aquaman) and TV shows (Friends, The Big Bang Theory). HBO Max will also have a lineup of Max Originals (Legendary, The Not Too Late Show with Elmo) that will effectively double the size of HBO’s current lineup of originals.

The 10 million HBO households who subscribe through owner AT&T’s platforms — AT&T TV, DirecTV and the freestanding HBO Now app — will automatically get HBO Max just by accepting the new terms and conditions. Millions more households who subscribe to HBO through Charter Spectrum, YouTube TV, Hulu, Apple’s TV app and other services that will likely be announced before or soon after the May 27 launch will also get automatic upgrades to HBO Max.

And you can get HBO Max for free by signing up or upgrading to premium tiers of AT&T’s various wireless, broadband and TV packages.

Will HBO Max Work To Drive New Subscribers?

If you’re not already an HBO subscriber, HBO Max is a brand new thing to consider alongside your other TV options. HBO Max at $14.99 a month is:

• Considerably cheaper than the traditional cable bundle ($110 a month),
• Comparable to Netflix ($12.99 a month), Prime Video ($12.99), and the Hulu/Disney+/ESPN+ bundle ($12.99), and
• More than Disney+ ($6.99), Hulu ($5.99) and Apple TV+ ($4.99).

Netflix, Hulu and HBO Max will be competitors the way NBC, ABC and CBS were competitors in the 1980s (sorry, CBS All Access). Maybe you’ll subscribe to one of them, or maybe two, or maybe all three, but Netflix, Hulu and HBO Max are going to be the dominant, premium-priced, something-for-everybody streamers for the foreseeable future.

Like Netflix and Hulu, HBO Max will be a super-scaled streamer with prestige TV (HBO originals), younger and more female-skewing TV (Max Originals), junk-food TV (sitcoms, reality), the biggest movie catalog of any major streamer (Warner Bros., New Line), news documentaries (CNN), children’s programming (Sesame Street, Loony Tunes) and just about any other category you currently watch on Netflix or Hulu.

At launch, HBO Max’s catalog will include The Big Bang Theory, Friends, The West Wing, Pretty Little Liars, Rick and Morty, South Park, the entire 50-year catalog of Sesame Street, dozens more shows, and more than 700 movies. That’s in addition to HBO’s entire catalog, HBO’s upcoming slate of originals, and an equally large slate of Max Originals.

Half of U.S. broadband households subscribe to multiple streamers, and that will accelerate as more households cancel their cable service and spend some of the savings on extra streamer or two. The Streaming Wars will have many winners, and HBO Max looks likely to be among them.

Will HBO Max Work for Owner AT&T?

HBO Max is very much the product of AT&T’s $85 billion acquisition of Time Warner — now WarnerMedia — a global media company that includes HBO, Cinemax, CNN, TBS, TNT, Turner Sports, the Warner Bros. film and TV studios, DC Comics, Rooster Teeth and Crunchyroll.

“Premium content always wins,” (then) AT&T chairman and CEO Randall Stephenson said in the announcement of the deal. “It has been true on the big screen, the TV screen and now it’s proving true on the mobile screen. We’ll have the world’s best premium content with the networks to deliver it to every screen.”

In the chart above — from AT&T’s investors event in October — each dot represents a series that will be in the HBO Max catalog. The dots are arranged on a horizontal axis by age and a vertical axis by gender, and the black dots are the Max Originals that will be added to the service over the next two years. AT&T is positioning HBO Max as a big-tent service with broad demographic appeal, and the Max Originals were specifically developed to fill in the demographic gaps.

HBO Max is already staffing up for the lower-cost, ad-supported tier that will launch next year. Hulu and CBS All Access have both seen more uptake of their cheaper, ad-supported tiers, and HBO Max could see a considerable boost from a price point several dollars below its $14.99 monthly price.

At some point HBO Max will likely add CNN, a dominant news brand that is quickly losing its place on living room TVs as two million households a quarter leave the traditional cable bundle. A handful of live-news streamers — CBSN, NBC News Now, ABC News Live and Cheddar — are growing fast from COVID-19 reporting and will continue to grow in an election year. CNN won’t lock itself to cable for much longer.

Scott Porch writes about the TV business for Decider and is a contributing writer for The Daily Beast. You can follow him on Twitter @ScottPorch.