Dallas based AT&T has announced a deal to merge WarnerMedia which includes popular media channels such as CNN and HBO with Discovery Channel. As part of the deal, AT&T will receive $43 billion in cash and WarnerMedia retain certain debt as well as it is spun into a new company with Discovery.
AT&T previously acquired Warner Bros. for $109 billion in a bid to vertically integrate its telecommunications, streaming and data empire and compete with rivals streaming services such as Netflix which has 208 million subscribers and Disney+ which has 100 million subscribers. AT&T failed to correctly utilize its entertainment assets and managed to lose customers by the masses on its DirectTV side along with its AT&T Now streaming service as its entertainment side of the company drifted without clear forward momentum. AT&T rebranded its streaming service several times creating confusing for customers while raising prices and reducing its channel lineup. The one thing that made it worth it was that AT&T wireless phone subscribers could stream their AT&T now tv service with no hit to their monthly data limits.
In the new company with WarnerMedia and Discovery merged into one new company, it will be valued at roughly $150 billion, will have 13 board members with AT&T choosing seven while Discovery will appoint six and the current head of Discovery, David Zaslav, will head the new company.