Jason Kilar details his first priorities to TheWrap a month ahead of HBO Max’s debut
Jason Kilar built up Hulu. Now he’s ready for his encore.
The longtime digital executive was named CEO of WarnerMedia on Wednesday, right as it is about to enter the high-stakes streaming era with next month’s launch of HBO Max. Kilar has been through this before. He was the first CEO for Hulu, back when it was a place for broadcast networks to help its viewers play catch-up and lead it through its expansion into original content.
Though he won’t start his new role until May 1, Kilar spoke with TheWrap hours after getting the gig. He predicted that the next 10 years could see a sea-change in the film industry and how he hopes to unify HBO Now and HBO Go under HBO Max.
The following has been edited and condensed for clarity.
TheWrap: HBO Max will launch as just about every American is forced to stay at home due to the coronavirus pandemic. How do you feel about potentially moving up that launch date, even by a week or two?
Jason Kilar: I don’t know the answer of whether that was debated or considered or talked about. At the end of the day, that’s Bob Greenblatt’s decision. It is an unusual, highly unusual time, in terms of the “shelter-in-place” orders around the world. But I do think that my experience with very big projects that have a technology component to them is that usually it’s quite difficult to pull them up. If it’s anything like other technology-heavy projects, usually it’s harder to pull those dates in, particularly when you’re in the final stages of the launch.
You have a very well-known legacy film studio in Warner Bros. under your purview. As someone coming from the digital side, how do you view the theatrical model and the traditional release windows?
It’s easy to talk about what about a scenario where you can go to a theater if you want, but you can also go to your couch if you want: Here’s the price to get it on your couch, and here’s the price to get it in the movie theater. But then there’s the other kind of thing to think about, which is the business model that makes it possible to be able to invest $200 million in a single film that lasts 90 minutes. What you need to do is be thoughtful about what do we need to do in order to make that possible. Historically, that’s meant having a first window that is exclusive [to theaters].
While I very much believe in the importance of having business models that allow you to take big, big risks in terms of investing $200 million, I also know that it’s inevitable that at a macro level that the future is going look different from history. How that plays out? I don’t want to paint any specific strokes because I don’t know. We’re going to see more experiments.
I think what you’re seeing right now with COVID-19, I think it’s more pragmatic optimism. I don’t think it’s any kind of grand experiment. It was a bit of an optimization that made a lot of sense. But something tells me that over the next 10 years, there’s going to be further invention and creativity. What you have to kind of be cognizant about is the theatrical partnerships. Those are important. How do you make that work going forward? It’s one of the most important questions that today is un-answered.
A film like “Wonder Woman” under normal circumstances would make close to $1 billion at the global box office. You would be losing money if you threw that directly onto streaming. But what about mid-budget films, ones that could be in danger of getting swallowed up at the box office? Would it make more financial sense to either put them on demand earlier or even directly on your own platform, where that boost in subscribers could counteract any lost theater revenue?
If you take a look at the percentage of theatrical slates that were accounted for by relationship dramas, or kind of, intimate, character-driven stories, and you compare that against larger spectacles, I think what you’d see is that there’s actually a real difference in programming. That doesn’t mean that there’s been less character-driven dramas. It just means that a big portion of them are actually going through different business models. Direct-to-consumer is a great option because it sometimes leads to more subscribers and it sometimes leads to more consumption. I think we’re going to see more of that.
You have a month to think about what you want to accomplish when you start. What are some of the first couple of goals for you?
I have to listen. I have to go and spend time with Jeff Zucker, Bob Greenblatt, Ann Sarnoff, Kevin Reilly and Casey [Bloys], Sarah [Aubrey] and others.
I want to listen and learn about their businesses and about the things that they are super excited about, and the things that they would love it if I can help them with, in terms of removing friction. Any great leader is always focused on trying to remove friction so that great leaders and great builders can do their best work.
The streaming business is much different, and more crowded, than during your days running Hulu. What lessons can you take from building up that service into launching HBO Max?
The importance of commitment. It is so important. Hulu never would have worked, if not for an unusual level of commitment. Having that level of commitment from a personnel standpoint, from a financial standpoint, from a strategic standpoint — those are incredibly, incredibly important.
WarnerMedia already had two streaming versions of HBO with HBO Go and HBO Now. HBO Max will cost the same price and include everything those two services have, plus Turner and Warner Bros. content. How do you view those three services existing together?
There’s sort of two ways to go about business. There’s a clean sheet of paper approach, which is what Hulu was. We didn’t have any historical service. There was one offering and one business model. The downside to that is we were starting with zero, in terms of content in the very first day and in terms of customers.
There’s tens of millions of people in the U.S. that already subscribe to an HBO branded service. That’s a good thing. Now, the challenging thing that those are three different phrases [including HBO Max]. Might it be better if there were just one flavor in terms of a brand? I think that what will happen over time, and it’s going to take time to get to a world where there is that simplicity, where you’re talking about one brand — and it’s HBO Max. There will be a simplification there that’s going to be better for customers.
So many streaming viewers are used to seeing very few or no commercials at all. What kind of role should advertising play in the streaming space?
I am a very big believer in the benefits that will come to customers with the option — and the keyword here is “option,” or maybe a better word is “choice” — of being able to have a service that can be ad-free, if they’d like that. Obviously, that’s at a certain price point. But then to also have the option, or the choice, to have the same access to that content, but made possible for a lower price with a modest amount of advertising. I think that’s a fantastic situation for the customer.
I think it’s fair to say that people are going to be under economic duress. Being able to have a lower-priced option that is made possible with a reasonable amount of advertising, thoughtfully executed (meaning that it’s personalized) is something that is not as interruptive as has historically been the case.