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Ads Are Coming to 'Game of Thrones' and More HBO Series on Streaming

 1 year ago
source link: https://www.businessinsider.com/warner-bros-discovery-planning-streaming-ads-on-hbo-originals-2022-12
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Ads are coming to 'Game of Thrones' and other HBO original series on streaming as Warner Bros. Discovery scrambles to slash its debt

Dec 16, 2022, 10:33 PM
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Game of Thrones

"Game of Thrones." HBO

  • Warner Bros. Discovery is planning to run ads in HBO originals like "Game of Thrones" on streamer HBO Max.
  • HBO is protective of its prestige content, and ads could rankle Hollywood creators and company insiders.
  • The opportunity could be valuable to advertisers because of the limited, premium nature of the shows.

Warner Bros. Discovery is exploring running ads in HBO originals like "Game of Thrones" and "House of the Dragon" on the HBO Max ad-supported tier, in a reversal of its earlier streaming strategy.

HBO Max launched its ad-supported tier in June 2021 for $10 a month versus the streamer's $15 ad-free version. The cheaper service lacks features like the functionality to download content and see same-day release films. HBO Max capped ads at four minutes per hour, limited how often users would see the same ad, and said no ads would run on original HBO programming. Andy Forssell, who was HBO Max EVP and GM at the time, called the plan an effort to create an "elegant, tasteful ad experience that is respectful of great storytelling."  

Since then, HBO Max parent WarnerMedia has been acquired by Discovery, and under new CEO David Zaslav, the merged entity Warner Bros. Discovery is racing to make streaming profitable and slash billions in debt. Executives are working on a plan to combine HBO Max with sibling Discovery+ into a new streaming service that is set to launch in the spring of 2023.

Ads running in HBO original shows and movies would be a controversial change to creators and people inside the company given how staunchly protective HBO is of its content.

Ad agency execs who have been briefed on the idea of ads in HBO content said they expected spots to start running on HBO Max soon and also to be part of the combined streamer. WBD has already been preparing for the new streamer by moving some Discovery+ content to HBO Max.

The spots would take the form of preroll ads at the beginning of current HBO originals and pre- and midroll ads in library content. The ad load would be in line with the current ad-supported HBO Max approach.

Some HBO originals have run with ads after they've been licensed to other distributors, like "Sex and the City" on E!

But HBO originals weren't created with ads in mind, so ads inserted in the middle of content could compromise the viewing experience and be controversial in Hollywood. When Netflix started running ads on the streamer, top Hollywood creators like Shonda Rhimes expressed displeasure, CNBC reported.

It's also unclear whether WBD will charge a premium for ads appearing in HBO originals — and if so, how much. One option would be to upsell HBO originals as a separate offering, as Hulu has done.

"There could be a premium associated with it because it's limited," one advertising source said.

While some advertisers would leap at the chance to be associated with HBO's prestigious originals, others wouldn't consider certain HBO originals suitable for their brands (think the Red Wedding scene on "Game of Thrones"). 

Advertisers who are already buying spots on HBO Max also might ask what the benefit is since they're already reaching the streamer's audience.

"For the right client, it could be right," another advertising source said.


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