AT&T combining network and subscriber base, Warner Media content and analytics-driven advertising
As it works to build what CEO Randall Stephenson has referred to as a “modern media company,” AT&T will leverage its subscriber base and network, combined with Warner Media content assets, to launch a direct-to-consumer streaming service in the fourth quarter, Warner Media CEO John Stankey said in an Oct. 10 statement.
“We are committed to launching a compelling and competitive product that will serve as a complement to our existing businesses and help us to expand our reach by offering a new choice for entertainment with the WarnerMedia collection of films, television series, libraries, documentaries and animation loved by consumers around the world,” Stankey said. “We expect to create such a compelling product that it will help distributors increase consumer penetration of their current packages and help us successfully reach more customers.”
While there aren’t many other details associated with the forthcoming streaming service, leveraging its consumer reach and content assets, AT&T recently stood up a new advertising business dubbed Xander after Alexander Graham Bell.
“The reality in this world we’re all moving into,” Stankey said during the recent AT&T Business Summit, “it’s a vertically integrated world. Software kind of warps every product and service people consume.” He said the creative process is still integral to content production but, “In order for customers to see it, it’s going to have to be wrapped with software. It’s brining that element from AT&T…to build that business model.”
AT&T’s acquisition of the former Time Warner, which includes the Turner broadcasting networks, HBO, CNN and Warner Brothers Studios among other properties, closed earlier this year, the Department of Justice is appealing a previous decision to allow the merger to go forward. DOJ has argued that the consolidation would result in an anti-competitive market environment. A federal judge disagreed.
Stephenson, speaking an event hosted by Goldman Sachs, outlined his vision. “f you’re going to own premium content, we think it’s an imperative that you have direct to consumer capabilities. Media companies need to work and go aggressively in getting directly to the consumer.” AT&T has around 170 million “direct to consumer relationships,” as Stephenson described them.