HBO Max is lowering its subscription cost by launching a new tier that will implement ads while giving customers another option besides its lofty $15 a month charge. Per Deadline, the company came to the realization that its initial subscription rate was too pricey.
“It turns out that most people on this planet are not wealthy,” WarnerMedia CEO Jason Kilar said during Morgan Stanley’s Technology, Media & Telecom Conference. “If we can wake up and use price and be able to kind of invent and do things elegantly through advertising to reduce the price of the service, I think that’s a fantastic thing for fans.”
Kilar said that HBO Max is on track to launch its new ad subscription tier to the platform later this year. This news comes as the streaming platform nears its one-year anniversary. Since then, HBO Max had become a premier destination for WarnerMedia’s gauntlet of movies and shows. WarnerMedia shook up the film industry when it announced late last year that all of Warner’s theatrical films slated to be released over the next two years would be available in theaters and on HBO Max on the same day.
When asked about that decision, Kilar said that they are still in “experimentation mode,” and that he’s interested to see what direction the rest of the industry will go later this year.
“Is theatrical attendance going to have a crazy resurgence because people have been cooped-up for a year?” he asked. “I could easily see that happening. And we will be there to serve them in that situation, and proudly so. When you look at our development pipeline, we absolutely are developing movies for theatrical exhibition.”