AT&T to merge media and entertainment division with Discovery Inc., forming streaming behemoth [View all]
Source: Washington Post
AT&T announced Monday that it plans to combine its entertainment and media company with Discovery Inc. in a deal that would create a TV, film and streaming behemoth featuring more than a half dozen top cable networks plus Warner Bros. studio and other properties. If approved by federal regulators, the deal would create a top new competitor in the entertainment spectrum three years following AT&’s blockbuster purchase of Time Warner that provided the telecom giant with CNN, HBO, Cartoon Network, TBS, TNT and the Warner Bros. studio.
The new company would combine with Discovery, which was founded as a documentary company in the Maryland suburbs in the 1980s but has grown to be the New York-based parent of networks including Animal Planet, Food Network, HGTV and the Travel Channel.Public interest groups, consumer advocates and President Trump’s Justice Department opposed AT&T’s Time Warner acquisition. The deal gave AT&T, which controls of much of the infrastructure bringing television and steaming services into American homes and smartphones, a premier entertainment company in WarnerMedia, one that owns top titles such as Game of Thrones and the Harry Potter movie franchise.
A federal judge and then an appeals court allowed the deal to go forward. That acquisition came on the heels of AT&T’s $67 billion purchase of DirecTV in 2015. AT&T sold off about one-third of its DirecTV stake earlier this year. But the spinoff is a sign that marshalling such disparate assets has not rendered the benefits AT&T hoped, and that executives believe a separate company would be better equipped to compete with the other major players in the streaming wars that are increasingly replacing cable as a source of entertainment.
Tops among those competitors are Netflix and Disney, which acquired 21st Century Fox in 2019. Netflix, valued at $219 billion, has approximately 208 million subscribers worldwide. Disney, worth $315 billion, has 100 million subscribers to its Disney+ service.
Read more: https://www.washingtonpost.com/business/2021/05/17/att-discovery-hbo-cnn/
Full headline: AT&T to merge media and entertainment division with Discovery Inc., forming streaming behemoth that includes HBO and CNN
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