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HBO Max's $9.99 Limited Ads Tier Enticing to Only 28% of Non-subscribers, Hub Study Says

HBO Max
(Image credit: WarnerMedia)

Only 28% of U.S. video consumers who don't subscribe to HBO Max say the service's new discounted $9.99 tier with limited ads will entice them to sign up. 

This nugget comes courtesy of Hub Entertainment Research, which said it polled 1,607 "U.S. TV viewers" age 16-74 in June for its "Monetization of Video" report. This was shortly after WarnerMedia launched the new HBO Max tier, which discounts the service from the ad-free price of $14.99.

Is $5 a month enough of an enticement? Well, HBO Max's growth is currently outpacing its rivals in the U.S.

WarnerMedia said that it added 2.8 million domestic subscribers across HBO Max and linear HBO channels in the second quarter--a period in which Netflix lost around 400,000 customers in the U.S. and Canada. It's also been reported that Disney Plus' Q2 domestic growth numbers will likely come in well under 1 million when the conglomerate reports second-quarter earnings in August. 

How much of HBO Max's relatively fruitful Q2 growth could be attributed to the late addition of the discounted tier is hard to discern--during AT&T's second-quarter earnings call last week, the company said only that it had a "successful" launch of the  new tier. 

Notably, the $9.99-a-month tier seems to be acting as an effective subscriber retention tool, with Hub reporting that nearly 40% of current HBO Max customers will likely switch over to the new tier. 

“It’s true that some TV viewers will do almost anything, including paying a premium, to avoid ads. But there are many who will choose ad-supported TV if it saves money or lets them watch a show they can’t watch somewhere else,” said Hub's Jon Giegengack, one of the study authors. “Tiered plans give viewers control of their experience. Whether they watch with ads or not, everyone is getting an experience they chose, and not one chosen for them.”  

Hub Entertainment Research

(Image credit: Hub Entertainment Research)
Daniel Frankel

Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. His reliable mid-range jump shot, deft ambidextrous post-up game and tough interior defense have been criminally overlooked.