AT&T Plans to Take on Netflix
AT&T executives on Thursday provided a roadmap for how the company plans to make money off its $85.4 billion acquisition: a three-tiered Netflix-style streaming service and the sale of some “non-core” assets — possibly including its minority stake in Hulu.
John Stankey, chief executive of WarnerMedia, the re-named content arm under AT&T that now includes HBO, CNN, TNT, TBS and Warner Bros. movie and television operations, said AT&T’s current products hit a narrow demographic and that the company planned to reach a much wider customer base.
WarnerMedia, which owns a library of still-popular shows including “Friends” and “The West Wing,” will offer multiple levels to its forthcoming streaming service: a movie-focused package, a premium service with original programming and blockbuster movies, and a third tier adding on its existing library and other licensed content.
“We really want the customer to want all three tiers,” he said. “We want the customer to commit all the way.” Both Disney and AT&T are set to launch new streaming video services in 2019 in an effort to catch up to Netflix, which has a sizable lead with more than 137 million subscribers.
John Stephens, chief financial officer of AT&T, said the company plans to sell some assets as part of its plan to pay down debt and refocus the telecom giant for a new, content-driven era. Stephens said the company could sell its 10 percent stake in streaming service Hulu.
Disney hasn’t officially announced its plans to bundle its services, but CEO Bob Iger has suggested in previous investor calls that the company is open to exploring those options. Now, with AT&T and WarnerMedia suggesting that’s the path they want to go down, it seems more than likely that Disney will announce something similar as the launch date for its own streaming service nears