HBO Max subscribers increase in third quarter as 'expected' despite many customers not actually using the app

The streaming service is catching up to Netflix's massive subscriber base

HBO Max is gaining a lot of subscribers even if not all of them are actually using WarnerMedia’s new streaming service.

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HBO Max launched in May of 2020 offering not only the full catalog of HBO originals but countless other properties from Warner Bros. as well as exclusives such as every episode of “Friends.” Although it’s considered one of the most expensive streaming services to have at $15 per month, users who already paid for HBO were grandfathered into an HBO Max subscription that the company says many are not taking advantage of.

HBO’s parent company, AT&T, said Thursday that HBO Max has reached 28.7 million total subscribers, according to The Hollywood Reporter. However, only 8.6 million are “activated” users, meaning they’ve taken the step to download and activate their HBO Max app.

The company said in its third-quarter earnings report that, although there remains a big difference between the number of subscribers to the number of active users, it’s still up by half compared to its last earnings season, where HBO Max reached 4.1 million subscribers in its first month. Therefore, the company remains optimistic about growth plans going into the future.

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"The growth and scale of HBO Max continues to show strong momentum, with activations more than doubling since last quarter to 8.6 million, and HBO/HBO Max subscribers up to 38 million, exceeding [the] initial end of year target of 36 million," the company said (via THR). "HBO and HBO Max subs top 57 million worldwide. HBO Max investment drove subscriber growth: 28.7 million total HBO Max subscribers."

TickerSecurityLastChangeChange %
NFLXNETFLIX INC.491.36+6.36+1.31%
TAT&T INC.29.03+0.04+0.14%

CEO John Stankey noted to Deadline that, despite the disparity, the rollout of HBO Max has “played out as we expected,” with the exception of the hiccups caused by the COVID-19 pandemic.

Although it has yet to figure out how to get its users actually using the app, HBO Max is continuing to provide stiff competition to fellow streaming giant Netflix. According to The Verge, Netflix also saw its subscriber base grow in the third quarter of 2020.  However, it slowed below projections despite the boom it's getting from people staying at home to binge-watch TV and movies amid the coronavirus pandemic.

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The outlet reports Netflix added 2.2 million net subscribers this quarter compared with the company’s 2.5 million guidance.

John Stankey, President & Chief Operating Officer of AT&T and Chief Executive Officer of WarnerMedia, speaks onstage at HBO Max WarnerMedia Investor Day Presentation at Warner Bros. Studios on October 29, 2019 in Burbank, California. (Presley Ann/Getty Images for WarnerMedia)

“The state of the pandemic and its impact continues to make projections very uncertain, but as the world hopefully recovers in 2021, we would expect that our growth will revert back to levels similar to pre-COVID,” Netflix’s letter to shareholders reads (via The Verge). “In turn, we expect paid net adds are likely to be down year over year in the first half of 2021 as compared to the big spike in paid net adds we experienced in the first half of 2020.”

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Meanwhile, both are contending with other new streaming services such as NBC's Peacock, Disney+ and much more.