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AT&T Inc. CEO John Stankey has defended moves by the telco and media giant to reorganize the management team at WarnerMedia to put a priority on creating and distributing content for streaming.
“Relative to the rest of Hollywood and some of the traditional media players, that movement that started during my tenure and that Jason Kilar has continued in his tenure being supported by the rest of the leadership team has been nothing short of significant and absolutely spot on in terms of the direction,” Stankey told the WSJ Tech Live conference during a session that was webcast.
Newly installed CEO Jason Kilar has steadily shifted the legacy cable and theatrical businesses towards the streaming space with HBO Max. Stankey said investment in the streaming platform content to broaden the audience and appeal of HBO Max would be put to use across Warner Media’s entire distribution base.
“I don’t think that’s any different than we see NBCU moving to now and starting to adopt and Disney most recently,” he argued. Stankey added HBO Max was ahead of previous guidance offered to Wall Street on subscriber growth for the streaming platform, though he cited upcoming financial results due out from AT&T for not quantifying that better-than-forecast customer growth.
He also said the current coronavirus pandemic and its impact on WarnerMedia had only accelerated a change in direction at the Hollywood studio that had been in place for some time as suddenly movie theaters closed, HBO Max content production shut down, as did TV sports.
As those varied businesses have started to reopen amid the pandemic, Stankey said Warner Media had to quicken its adaptation to new realities. “We’ve seen some dynamic occur where streaming becomes more important as people are holed up in their homes, choosing to entertainment themselves, and so very quickly it was clear a new day had dawned and there was going to be some acceleration involved,” he argued.
Stankey also said WarnerMedia will produce content for theatrical, linear and streaming distribution, but with a focus on direct-to-consumer platforms amid the pandemic, and especially Premium video-on-demand. “I do believe that if you’re going to be effective in creating any meaningful content that’s relevant, you’re going to want to be able to take advantage of theatrical, as well as a general entertainment streaming platforms, and we’re incredibly well positioned to do that with our legacy and heritage,” he argued .
Stankey also told the investor conference AT&T isn’t eyeing any big acquisitions as it drives into the streaming arena with HBO Max. “In terms of us acquiring something, that’s not our focus right now,” he explained.
But divestitures, including possible for DirecTV, is another matter, though the AT&T boss wasn’t specific. “If there are some opportunities for us to look at the portfolio that we have today, and we decide that there’s something that doesn’t fit into the profile and it’s distracting management, is that something we’d consider for a divestiture or some other structural alternative, any good management team should be thinking of those things,” Stankey added.
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