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Under new deal, HBO Max and Discovery+ could combine content

By Dan Selcke

BURBANK, CALIFORNIA - OCTOBER 29: Kevin Reilly, Content Officer of HBO Max and President of TNT, TBS, & TruTV, speaks onstage at HBO Max WarnerMedia Investor Day Presentation at Warner Bros. Studios on October 29, 2019 in Burbank, California. (Photo by Presley Ann/Getty Images for WarnerMedia)
BURBANK, CALIFORNIA - OCTOBER 29: Kevin Reilly, Content Officer of HBO Max and President of TNT, TBS, & TruTV, speaks onstage at HBO Max WarnerMedia Investor Day Presentation at Warner Bros. Studios on October 29, 2019 in Burbank, California. (Photo by Presley Ann/Getty Images for WarnerMedia) /
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WarnerMedia is merging with Discovery to create a new company. What does this mean for the ongoing Streaming Wars?

Big business news today: according to Variety, AT&T is spinning off WarnerMedia — the media conglomerate that operates HBO, HBO Max, CNN, Adult Swim, DC Films and much more — and merging it with Discovery, the media conglomerate that operates Discovery Channel and the Discovery+ streaming service. The new company, which doesn’t have a name yet, will be controlled by shareholders from both companies: 71% from AT&T and 29% from Discovery. The whole thing will be headed up by Discovery president and CEO David Zaslav.

What does this mean? Well, for AT&T, it may be an opportunity to give up on running WarnerMedia (formerly Time Warner), which it bought in 2018 for $85 billion but never seemed to quite know what to do with. According to Bloomberg, which originally broke this story, AT&T is “one of the world’s most indebted companies,” so maybe this is a way to take some of the pressure off themselves so they can focus on building up their 5G network.

As for us, it’s unclear that this means. Will AT&T still offer HBO Max free to subscribers? Will there be any shakeups with content? The best case scenario I can think of is that AT&T keeps offering free HBO Max to folks who subscribe to their cable packages, and that all the content on Discovery+ gets integrated into HBO Max, which has the bigger footprint. After all, the whole point of a merger like this is to become big enough to compete in the streaming wars against giants like Netflix and Disney+, so that move makes sense to me.

But will it make sense to Zaslav and the other decision-makers? For now, he’s weighing the options. “We want our company to be the place [for creative storytellers]”, he said. “If we are successful with that, the free cash flow is going to grow.”

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