It’s a blockbuster deal that could shake up the streaming industry: US media groups AT&T and Discovery are joining forces and merging their TV and video divisions. The result is to be a new super streaming service.
AT&T spins off Warner Media and merges it with Discovery
In the USA, the two media groups AT&T and Discovery are merging. To do so, telecommunications company AT&T is selling its stake in Warner Media and merging it with Discovery. This will create a new super streaming service.
For the sale of Warner Media, AT&T will receive a total of 43 billion US dollars. That is the equivalent of more than 35 billion euros. The payment will be made in the form of cash, shares and the assumption of debt.
AT&T’s shareholders will also hold 71 percent of the new company. The remaining 29 percent will be held by Discovery.
The new super-streaming service from AT&T and Discovery offers this content
With Netflix (over 200 million subscribers) and Disney Plus (over 100 million subscribers), two strong players already dominate the streaming market. In addition, Amazon Prime, Paramount Plus and IMDb TV are other established providers with subscribers in the two- to three-digit million range.
But the new streaming service from AT&T and Discovery doesn’t have to hide either. The following channels, content and offerings will be combined in the new concept, among others:
- Warner Bros.
- DC Comics
- Cartoon Network
- Turner Networks
- Animal Planet
In theory at least, a Hollywood studio, one of the world’s most important news channels and numerous special-interest icons form an interesting mix.
Whether the new super streaming service can establish itself on the market – nationally and internationally – depends heavily on the price and the performance offered. After all, Discovery and HBO Max already have over 100 million subscribers before the launch. So the basis is definitely there.
AT&T focuses on core business
With the spin-off, AT&T CEO John Stankey is taking the next step on his road to return. The group’s focus is to be on telecommunications again. The merger of the media business is the next step.
Nevertheless, this is a minus business. After all, AT&T under predecessor Randall Stephenson had only taken over the conglomerate around Warner Media for 80 billion US dollars in 2018. In the end, therefore, a loss of just under 40 billion US dollars remains.
AT&T’s huge mountain of debt is also the result of numerous takeovers in recent years and decades. Before the spin-off, this amounted to over 150 billion US dollars. This makes the group one of the most heavily indebted companies in the USA.
John Stankey also wants to get rid of this image. Instead of streaming, his company is now focusing on telecommunications again. In concrete terms, this means, for example, expanding the 5G mobile network and the fiber-optic network in the USA.