AT&T Exec on Getting Reese Witherspoon, Taylor Swift for DirecTV Now; Why CBS Is Missing

Brad Bentley - Getty - H 2016
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Brad Bentley also talks about how the telecom giant has been becoming more and more of an entertainment company and how the planned acquisition of Time Warner fits into that transformation.

AT&T on Monday unveiled more details of its DirecTV Now streaming service, which launches Wednesday.

Networks from all major entertainment companies, except for CBS Corp., will be part of it.

Brad Bentley, executive vp, marketing, AT&T Entertainment Group, was among the AT&T executives who touted the service at the midtown Manhattan launch event.

He spoke to The Hollywood Reporter about how AT&T is transforming into more of an entertainment company, including via its planned $85.4 billion acquisition of Time Warner, why CBS Corp. hasn't struck a deal to be part of DirecTV Now and why the streaming service is planning channels with content from Reese Witherspoon and Taylor Swift.

The DirecTV Now launch event didn't feel like a traditional telecom event...

We're a new company. I purposely wanted to do that because we are an entertainment company, we are evolving. This has been part of a transformation for the product, for the customer and the industry, but also for AT&T. All of this is a big internal and external transformation — from what you see in advertising and in how we go to market.

Why has entertainment come so much into focus for AT&T, which used to be known mostly as a phone giant, and how does the Time Warner deal fit into that?

It's interesting what people are doing on mobile devices, with 80 percent being entertainment. They are streaming content, music or playing games. So when you are a major mobile provider and 60 percent of your network is people streaming video, you realize the importance of video. So it's really converged where connectivity meets entertainment. And entertainment is now wireless. AT&T had the foresight and bought the spectrum, bought DirecTV and is now in a position to fully bring that to life.

And as you know we have the pending acquisition of Time Warner, so that we are adding more content and vertically integrating, so we can provide more choice, more flexibility, more value for the customer.

I hope that people walk away from this AT&T event thinking that they are looking at it from the customer's point of view, they are breaking down the hurdles and giving more choice and value. That's what we want to continue to do and that's what's behind that acquisition. The sum of all that is that AT&T is a totally transformed company. Part of my job is to make consumers understand that this is not a telecom company, but a company that is bringing premium entertainment everywhere.

How important is it to have big names like Reese Witherspoon and Taylor Swift involved in DirecTV Now?

I want to communicate that we are involved beyond traditional pay TV. It's a new model and the content will evolve beyond the traditional.

Partnering with Taylor was part of an opportunity to really go after the millennial audience, and she had all this great content. The Reese Witherspoon deal was part of what we have been doing with Otter Media, investing in up-and-coming content creators. These are bets that show it is about so much more than traditional content.

Two big names missing from DirecTV Now are CBS and Showtime, which are both part of CBS Corp. What's been the holdup in reaching a deal with CBS Corp. to be part of DirecTV Now?

They went out with CBS All Access and wanted to go direct to consumer on their own and hold back a lot of those VOD rights. They have the notion of a much higher price point they want for the service to go over-the-top.

I think at the end of the day consumers don't want to deal with multiple [services]. I think when they see this product, they are going to realize that they want to be part of it, and we would love to have them. I suspect something gets done.

What could be DirecTV Now's impact on the pay TV industry, and do you fear cannibalization?

The premium experience is still going to be superior to what we are offering, because there you have 4K and all the local channels and multiple streams. In my house, I couldn't live on the two streams DirecTV Now offers. I have nine TVs that hang on the wall and when you add all the other devices, I probably have 25. 

Although some may trade down, we are not too concerned about that. The pay TV industry is poised to evolve a bit. It's a declining industry, and the reason is that it hasn't evolved. So we want to lead that.