While streaming giants such as Netflix and Disney+ are gearing up to offer ad-supported options to their customers, new data suggests that HBO Max members are perfectly happy to pay for an ad-free experience.
According to Hub’s 2022 Best Bundle study, 67% of HBO Max subscribers choose to pay full price for an ad-free experience. That’s in stark contrast with the 20% of Peacock members willing to shell out more to use the platform ad-free. In fact, a whopping 73% of Peacock users opt for the ad-supported version.
Peacock may be at the low end of ad-free subscriber count, but major streaming platforms like Hulu and Paramount+ aren’t exactly close to HBO Max’s lead. Hulu is 32% behind HBO Max, with its ad-free subscribers at 35%, while Paramount+ is at 31%. The majority of users on both streaming platforms prefer to use the ad-supported services rather than pay extra to go ad-free.
The only other streaming service with more ad-free subscribers than ad-supported users is HBO Max’s corporate sibling streamer Discovery+. The platform has 52% ad-free subscribers, although this figure is still 15 points behind HBO Max’s 67%.
HBO Max’s ability to attract consumers to their ad-free subscription could very well be due to its content. Even before streaming took over the industry, when cable TV was even more prevalent in homes across the U.S., HBO was always considered a premium channel. Basic cable packages never included the network, with consumers forced to pay extra if they wanted access to its quality content.
While the introduction of streaming has made HBO’s library far more accessible to consumers, perhaps its reputation as a “deluxe” service is cemented in the consumer consciousness. This may be why HBO Max subscribers are open to paying a higher price for the streaming service with no ads; viewing the high-quality content as a bargain untethered from the cable package it was once touted alongside.
HBO’s big-production, archive series such as “Game of Thrones,” “The Sopranos,” “Boardwalk Empire,” as well as new hits like “Peacemaker,” “We Own This City,” and “The Gilded Age” could be just the type of content that consumers don’t want interrupted by ads.
Game of Thrones
Seven noble families fight for control of the mythical land of Westeros. Friction between the houses leads to full-scale war. All while a very ancient evil awakens in the farthest north. Amidst the war, a neglected military order of misfits, the Night’s Watch, is all that stands between the realms of men and icy horrors beyond.
Peacock is NBC’s answer to the streaming wars, a network that has always been either free or available at a low cost to most U.S. consumers for decades. Perhaps it will simply take time for other streaming services such as Paramount+, Hulu, and Peacock to prove worthy of an ad-free subscription.
Conversely, it’s widely known that ad-supported tiers tend to generate more revenue than ad-free subscriptions. Netflix and Disney+ adding their own ad-supported subscriptions could very well alter the streaming landscape enough for HBO Max to shift around its content. HBO’s legacy cable brand has always skewed male, while its streaming arm has tried to course-correct with more female-focused content. Perhaps as HBO looks to continue adding subscribers, the stream will further evolve offering its light-hearted shows in its lower-priced tier, with its prestige dramas remaining ad-free.
The right balance between ad-free content and ad-supported subscriptions is now something that the majority of streaming platforms must contend with. It will be interesting to see how this plays out for consumers going forward.
Max
Max is a subscription video streaming service that gives access to the full HBO library, along with exclusive Max Originals. There are hubs for content from TLC, HGTV, Food Network, Discovery, TCM, Cartoon Network, Travel Channel, ID, and more. Watch hit series like “The Last of Us,” “House of the Dragon,” “Succession,” “Curb Your Enthusiasm,” and more. Thanks to the B/R Sports add-on, users can watch NBA, MLB, NHL, March Madness, and NASCAR events.