AT&T has completed its $85 billion acquisition of Time Warner Inc., just two days after a federal judge ruled against objections to the deal by the Department of Justice.
The deal brings together global media and entertainment leaders Warner Bros., HBO and Turner with AT&T’s strong presence in technology and its video, mobile and broadband customer relationships. AT&T also owns DirecTV which it bought in 2015.
“The content and creative talent at Warner Bros., HBO and Turner are first-rate. Combine all that with AT&T’s strengths in direct-to-consumer distribution, and we offer customers a differentiated, high-quality, mobile-first entertainment experience,” said Randall Stephenson, chairman and CEO of AT&T Inc. “We’re going to bring a fresh approach to how the media and entertainment industry works for consumers, content creators, distributors and advertisers.”
The completed deal comes just over six months after Meredith Corporation purchased NY-based Time Inc. Now both Time Warner and Time Inc. are no longer independent companies.
AT&T is also reportedly considering dropping the Time Warner name. Time Warner Cable was purchased by Charter Communications in 2016 and the Time Warner name was dropped and now known as Spectrum.
AT&T’s Stephenson said the future of media entertainment is rapidly converging around three elements required to transform how video is distributed, paid for, consumed and created. The AT&T-Time Warner combo brings together:
- Premium Content: Leading movies and shows from Warner Bros., HBO and Turner, along with digital content from Bleacher Report, FilmStruck and AT&T’s investment in Otter Media, among others.
- Direct to Consumer Distribution (D2C): AT&T has more than 170 million D2C relationships across its TV, video streaming, mobile and broadband services in the U.S., mobile in Mexico, TV in Latin America, in addition to D2C digital properties such as HBO NOW, Boomerang, FilmStruck and CNN.com.
- High-Speed Networks: AT&T‘s leading wireless and fiber network, including investments in new technology such as 5G, will provide the network bandwidth required as customers increase engagement with premium video and emerging 4K and virtual reality content.
Company Structure, Executive Leadership
AT&T Inc. consists of four businesses. This structure allows each business to operate independently and move quickly, while at the same time innovating across AT&T with content, connectivity and advertising. The four business are:
- AT&T Communications provides mobile, broadband, video and other communications services to U.S.-based consumers and nearly 3.5 million companies – from the smallest business to nearly all the Fortune 1000 – with highly secure, smart solutions. Revenues from these services totaled more than $150 billion in 2017.
- AT&T’s media business consists of HBO, Turner and Warner Bros. Together, these businesses had revenues of more than $31 billion in 2017. A new name for this business will be announced later.
- AT&T International provides mobile services in Mexico to consumers and businesses, plus pay-TV service across 11 countries in South America and the Caribbean. It had revenues of more than $8 billion in 2017.
- AT&T’s advertising and analytics business provides marketers with advanced advertising solutions using valuable customer insights from AT&T’s TV, mobile and broadband services, combined with extensive ad inventory from Turner and AT&T’s pay-TV services. A name for this company will be announced in the future.
Jeff Bewkes, former chairman and CEO of Time Warner Inc., has agreed to remain with the company as a senior advisor during a transition period. “Jeff is an outstanding leader and one of the most accomplished CEOs around. He and his team have built a global leader in media and entertainment. And I greatly appreciate his continued counsel,” Stephenson said.
As previously announced, leading the four businesses and reporting to Stephenson will be:
- John Donovan, CEO of AT&T Communications;
- John Stankey, CEO of AT&T’s media business;
- Lori Lee, CEO of AT&T International and Global Marketing Officer of AT&T Inc.; and,
- Brian Lesser, CEO of AT&T’s ad and analytics business.
All of Jeff Bewkes’ direct reports will now report to John Stankey.