AVOD, international deployment, fusion reaction

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  • Sarah Lyons, HBO Max Product Manager, spoke to Insider following the announcement of the WarnerMedia and Discovery merger.
  • She spoke about the creation of the new international and ad-supported experiences of HBO Max.
  • She also spoke about how past mergers have shaped her career and how she leads in times of change.

HBO Max

product exec Sarah Lyons has experienced major mergers before.

Lyons worked at DirecTV when it was acquired by AT&T, and at AT&T when it acquired Time Warner.

Today, she leads a team of 150 WarnerMedia employees through another period of significant change.

AT&T dropped the bombshell last week by divesting its entertainment division, now called WarnerMedia, and merging it with Discovery Communications.

Lyons sat down virtually with Insider during the week the deal was announced for a high-profile interview that was scheduled before the news broke. From her home office in Encino, Calif., She spoke about the future of HBO Max as well as her own experience with mergers and how they shaped her career.

“I don’t know what to expect,” Lyons said of the future after the merger, adding that she had been candid with her team about not having all the answers. “But we have so much ahead of us that we can and will accomplish… It’s a great way to keep moving forward and feeling positively.”

The streaming home of HBO and Warner Bros. aims to strike a delicate balance between serving ads without interrupting the story

2021 is set to be a big year for HBO Max.

The service, which launched last May, is expected to roll out its ad-supported level in June and begin to roll out internationally.

As executive vice president of global consumer product management, Lyons oversees the overall appearance of the service, including its advertising product.

HBO Max’s ad-supported tier will debut in the first week of June for $ 9.99 per month, $ 5 less than the ad-free version. Lyons said HBO Max targets younger and less wealthy generations for whom a price tag of $ 15 per month is out of reach.

But some of these consumers, like those raised on


Netflix

– are not used to the heavy advertising costs of cable TV. HBO viewers aren’t either. One of Lyons’ challenges was to create an enjoyable advertising experience for these people.

“I never want the customer to feel bad for choosing an ad-supported service,” Lyons said.

WarnerMedia CEO Jason Kilar, who has had a customer-centric mindset since his years at Amazon and also worked at


Hulu

, prompted HBO Max executives to put the customer before the ad experience, The Information reported.

Jason Kilar Warner CEO of Media

Jason Kilar.

Justin Sullivan / Getty Images


HBO Max begins with a “brand block” ad format that displays a map presented by you before a piece of content begins. The rest of this block of content, whether it’s an episode or a movie, will run with minimal commercials, which could include pre-roll bumpers, 15-second spots, and commercials. mid-roll, the company said.

HBO Max has promised an average commercial load of 4 minutes per hour. According to CNBC, that’s less than Peacock’s 5-minute-per-hour cap and the roughly 9-minute ads per hour on Hulu’s ad-supported on-demand level.

Ads will not appear on HBO programming.

But other shows will have commercials. Lyons said his team hand-identified the location of the commercials in each episode so they didn’t interrupt the flow of the story.

“We really didn’t want the user to be removed from the emotional depths of the content they might be watching,” Lyons said.

It has to do with the human touch that Lyons hopes will set HBO Max apart from Netflix and other services where discovery is dominated by algorithms.

HBO Max has an editorial team that curates recommendations for different types of users based on news, time of year and other factors, Lyons said. The app provides these recommendations to users based on the likelihood that their viewing history and other data indicates that they like that content.

“I wouldn’t see horror movies because they don’t speak to me, but instead I like fantasy, cooking, and wellness shows, so I would see the curations that are related to what I’m doing. ‘Likes, “said Lyons, who currently watches HBO’s” The Nevers “. “Essentially, we combine a tailored, tailored content service for our users with underlying data. “

Later, HBO Max will introduce another advertising format with which brands can sponsor pages from these editorial curations, or other collections of content around particular themes. It will be similar to how brands can sponsor collections of new TV episodes or other content on Hulu.

The Elephant in the Room: WarnerMedia’s Merger with Discovery

Lyons would not speculate on the future of HBO Max after the merger.

But it’s safe to say that the merger, which will bring together the vast content operations of WarnerMedia and Discovery, will complicate


Diffusion

plans. Still, the deal is not expected to be concluded until the middle of next year. This leaves WarnerMedia employees about a year of “business as usual” before integration with Discovery begins.

Lyons knows that staff members can be distracted or lose heart in the midst of the uncertainty or layoff issues that accompany mergers.

“It’s easier for more junior teams or employees to get into a negative mindset, and it actually hinders them during times of change,” Lyons said. “If you can keep them focused on the positives and focused on the goals and the things that are under their control… that really puts them in the right direction.”

Lyon’s professional rise is proof that not all mergers are catastrophic.

Lyons, who started at DirecTV doing direct mail and moved on to product management, moved to a bigger stage at AT&T after the DirecTV merger; she worked on the team that launched the now-closed streaming TV service DirecTV Now. She was also one of the first executives hired to work on HBO Max after AT&T acquired Time Warner.

She got ahead, even through upheaval, in part because she wasn’t afraid to expand into new areas when consumers’ attention shifted.

During the


recession

, she was asked by DirecTV to understand why consumers were canceling add-ons like HBO or NFL Sunday Ticket, and trying to turn the tide of the multi-year decline. She ended up expanding beyond her marketing role to work with engineering teams to try and improve the set-top box experience. She eventually moved from the business side to the product side in 2012. And that adaptability has stuck with Lyons throughout her career at DirecTV, then AT&T and HBO Max.

Now, as a leader, she also tries to give her staff space and be direct when she doesn’t have the answers. She opened her virtual door for employees to share their concerns and said she mostly listened instead of going into “problem-solving mode”.

HBO Max translates its product experience to audiences in Latin America and other parts of the world

While part of Lyons’ product team prepares for the ad-supported launch, others are working to expand the service internationally.

HBO Max begins rolling out in 39 territories in Latin America and the Caribbean on June 29, with no ads to start.

It offers a standard plan and a mobile-only plan starting at $ 3 per month. (Netflix also offers a mobile-only plan in India and other parts of the world where smartphones are the dominant device for viewing videos.)

The service will have much of the same ad-free experience that is available in the United States today. There will be separate editorial teams to organize content for each country and languages ​​will be localized by region, as will payment methods so customers can use local banks or even vouchers in certain locations, said. Lyons.

Ahead of the international debut, HBO and HBO Max racked up 44.2 million domestic subscribers, according to the company.

While Lyons has said she is looking at total follower count, her team is focusing more on engagement. She will be closely monitoring the reaction of international users to features that have worked well in the United States.

It looks at metrics, including how many customers watch, how long they watch, and how their engagement has changed over time.

Recently, HBO Max released a line for kids that lets them find movies or TV shows by character rather than title or genre. Lyons said they have increased viewing time for children, which indicates the feature is a success.

There were also missteps. His team removed a button to restart a title because data showed it wasn’t used frequently. But, after a lot of customer feedback, they put the button back in place.

Tom and Jerry Warner Bros


Warner Bros.


Lyons also found that family-friendly blockbusters are a big boost to engagement.

Although HBO Max is named after a premium TV brand that doesn’t shy away from sex, drugs, or violence, Lyons has pushed for rendering the service, which also houses Cartoon Network, suitable for families.

“If you can create an experience that the kids at home are also passionate about, then the kids grow up with your service and your service grows with the kids, and when they leave home and go to college, you have subscribers for the. life, ”said Lyons, whose 8-year-old son discovered Looney Tunes through HBO Max.

Remember, ultimately convincing them to pay for the service separately rather than borrowing their parents’ passwords is a larger conversation that all streaming services grapple with. But these younger generations are also who HBO Max is trying to talk to with its new, cheaper ad-supported offering.

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