AT&T and Discovery have recently gone official with the decision to merge their two companies. The agreement involves WarnerMedia and Discovery coming together in a partnership where AT&T shareholders own the majority stake – in other words, 71%.
The deal will close in mid-2022, and other results include AT&T receiving $43 billion, as well as debt securities and the retention of debt WarnerMedia currently holds. As it stands, David Zaslav – CEO of Discovery – is currently set to run the new combined company.
A press conference which recently took place involved AT&T’s John Stankey revealing that Jason Kilar from WarnerMedia would be in his existing position during the transition period. However, Zaslav would be behind any personnel decisions from that point onwards.
The new merger sees the formation of a company which spends a similar annual amount on content compared with Netflix – in other words, $20 billion per annum. The content will be going to several movie studios and TV networks joining forces as a result of the partnership.
For example, Warner Bros, CNN, TNT, Discovery, TBS, Food Network, TLC and Animal Planet will all fall under the same umbrella. This has led to speculation about the pricing of streaming services, as fuboTV and Philo do not have the WarnerMedia stations at this point in time. Industry insiders are now questioning whether this will lead to a price hike for Hulu Live TV and YouTube TV subscribers.
Additional questions concern the two streaming services Discovery+ and HBO Max, as speculation indicates that both could be combined into one massive streaming service. Alternatively, there could be a reshuffling of content between the two platforms, or options to sign up for a bundle at a discounted price as currently exists with Disney+, Hulu and ESPN+.
