Warner Media CEO Jason Kilar is in the spotlight after AT&T increased its focus on growing its broadcast service.
The company said Friday that it expects HBO and HBO Max to grow from 61 million subscribers by the end of 2020 to between 120 and 150 million subscribers worldwide by the end of 2025, compared to its forecast of 75 million to 90 millions. This growth will be driven in part by the launch of the service in 60 international markets in June, as well as a lower-cost advertising service, which also debuts in June.
Kilar told CNBC on Friday that the focus is on “the market response in the first ten months, combined with the things we believe will be quite useful in Latin America and Europe, where we already have a presence, both in terms of programming as well as distribution “. He added: “It’s not just what we think will happen outside the United States, but it depends largely on the smooth running of the U.S. market in the coming years.”
Kilar predicts that HBO Max will be one of three streaming giants to emerge, along with Netflix and Disney +, which surpassed 100 million subscribers earlier this month. And HBO Max’s upcoming advertising service (Netflix and Disney don’t offer any) will give the company an advantage by offering a lower price.
“Being able to offer the HBO Max quality experience, which is on the highest platform in terms of quality, to be able to offer it at a lower price and let consumers decide which version they would like,” Kilar said. “I think it will play a safe role in the American market.”
The company has not yet decided which markets will include an ad version.
Kilar also said that the ad version of HBO Max will actually be more profitable than the traditional subscription service.
“It won’t be the first day, give us probably four quarters, maybe eight quarters, to reach our scale when it comes to ad sales and ad placements, and nothing. But when you look at what the opportunity is, and I say this based on the marketing professionals and how much your dollars are putting on the table, to be able to be part of such a light advertising environment where the effectiveness is quite high. “
What will follow for theatrical premieres?
Kilar announced in December, to the dismay and confusion of content creators and theatrical chains, that HBO Max would air Warner Brothers theatrical debuts the same day they hit theaters.
This strategy was launched right through the 18 theatrical premieres Warner Brothers had scheduled this year, Kilar told CNBC
“We feel very good about this decision, we feel very good about this strategy. I wish we could go back in time and that we could take place, instead of the day one or two days of talks before announcing this news, m ‘I wish we had had a week or two.’ He admitted, “I think we could have done a better job in terms of these communications and conversations with storytelling partners, directors and producers and their representatives.”
Kilar said that looking beyond 2021, the study will take two different strategies for two different types of images.
“One of which will be the wide, epic film you expected from us, which has an exclusive theatrical run. I think the run will be shorter than it had been in the past. The World of DC and Harry Potter and things like that, great epic movies, I think they deserve and will have an exclusive theatrical career, but there will be other movies, a lot of movies that will go to HBO Max on the same day that these same films were available to exhibitors and cinemas around the world. “
Between films that debut exclusively in theaters and those that go directly to HBO Max, Kilar says they will invest more in film production for both formats.