The media world was shaken upon hearing the news that telecommunications giant AT&T agreed to buy Time Warner, owner of Warner Brothers movie studio, HBO, and CNN for the price of $85.4 billion.
Both parties unanimously approved of the said deal. One of their top priorities is finding ways of reaching consumers who do not have cable subscriptions.
AT&T CEO Randall Stephenson will run the combined company which will offer unique services particularly on mobile. By the end of the year, AT&T is expected to offer a streaming TV package, DirecTV Now, whose target are people who have dropped their cable subscriptions or never had one.
The CEOs of the two companies believe that it will be easier to innovate once they are already merged. As said by Time Warner CEO Jeff Bewkes, more money will help fund the production of additional programming and films.
It is believed that this is “a good defensive move” against Comcast who continues to stretch into new businesses. Just recently, Comcast bought DreamWorks Animation.
This mega deal, however, will not be an easily smooth one as this merger will have to face tough scrutiny from government regulators. Until then, the merged company will not be formalized.
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