Paramount+ plans free tier ahead of HBO Max merger

Paramount+ is preparing a wave of new features designed to boost engagement and revenue as parent company Paramount Skydance finalises its $110 billion acquisition of Warner Bros. Discovery.

The deal will hand Paramount control of HBO Max and Discovery+, and executives are moving fast to reshape the platform before that integration begins.

Paramount's streaming leadership told employees at a summer town hall that Paramount+ plans to introduce a free tier, micro dramas, and new interactive ad formats.

Based on an internal document accessed by Business Insider, some of the free tier initiatives are expected in Q4 2026 and Q1 2027, although there have been no confirmed dates for their release. 

Before testing the service on the free tier, users will have to sign up using their email addresses, according to the document, which states that this is "the foundation" for turning them into paid subscribers.

The reason for such urgency is the poor retention rates. According to subscription metrics firm Antenna, almost 6% of Paramount+ subscribers dropped their services in August, which is the second-largest churn rate among the big streamers.

A separate June Antenna report found more than a third of Paramount+ users watch the service only lightly, a higher share of casual viewers than any major paid competitor.

Media analyst Rich Greenfield of Lightshed Partners said Paramount is "throwing a lot of things at the wall to see what drives engagement" in what he called a war for time spent against YouTube.

Beyond the free tier, Paramount+ is expanding the short vertical video format it launched in April and adding video podcast segments to capture mobile viewing throughout the day.

The company also plans to add a comments section to its TikTok-style feed and use AI to help automate video clipping, according to the internal document.

Paramount is just about done with its convergence process of bringing together Paramount+ and free streamer Pluto TV on one tech platform. How HBO Max and Discovery+ will integrate into this is still to be seen.

In a memo issued by Ellison on Monday, he stated that there are certain concerns his employees had regarding their job functions and operations that he himself couldn’t address for the time being. There was an experienced employee at WBD who predicted “another war of the tech stacks".