AT&T is to buy Time Warner in an $85.4 billion agreement.
The transformational deal turns the bell company into a global media giant. It brings together Time Warner’s content brands including HBO, CNN, Turner Broadcasting and of course the Warner Bros Hollywood studio with the telephone company that as owner of DirecTV already holds the world’s largest pay-TV subscriber base.
“With great content, you can build truly differentiated video services, whether it’s traditional TV, OTT or mobile. Our TV, mobile and broadband distribution and direct customer relationships provide unique insights from which we can offer addressable advertising and better tailor content,” said AT&T chairman and CEO, Randall Stephenson.
“It’s an integrated approach and we believe it’s the model that wins over time. Stephenson described the combination as a create fit that created immediate and long-term value for shareholders.”
Warner Bros film franchises include Harry Potter & DC Comics, and its produced TV series include Big Bang Theory and Gotham, while HBO own series such as Game of Thrones, Silicon Valley, The Wire and many more.
Time Warner Chairman and CEO Jeff Bewkes said, “This is a great day for Time Warner and its shareholders. Combining with AT&T dramatically accelerates our ability to deliver our great brands and premium content to consumers on a multiplatform basis and to capitalise on the tremendous opportunities created by the growing demand for video content.”
Time Warner has not been without its suitors. In July 2014, Fox tabled an $80 billion offer for the company that was rebuffed and ultimately withdrawn a month later.
But it is the collapse of the 2000 merger between AOL and Time Warner – the subject of business school teaching – that today’s bosses will hope is not repeated.
