AP

AT&T, Discovery join media houses as cord-cutting encroaches

May 17, 2021, 6:55 AM | Updated: May 24, 2021, 2:15 pm
FILE - In this Oct. 21, 2014 file photo, people pass an AT&T store in New York's Times Square. ...
FILE - In this Oct. 21, 2014 file photo, people pass an AT&T store in New York's Times Square. AT&T will combine its media operations that include CNN HBO, TNT and TBS in a $43 billion deal with Discovery, the owner of lifestyle networks including the Food Network and HGTV. The deal announced Monday, May 17, 2021, would create a separate media company as households increasingly abandon cable and satellite TV, looking instead at Netflix, Amazon Prime Video, Facebook, TikTok and YouTube. (AP Photo/Richard Drew, File)
(AP Photo/Richard Drew, File)

NEW YORK (AP) — AT&T will combine its massive media operations that include CNN, HBO, TNT and TBS in a $43 billion deal with Discovery, the owner of lifestyle networks including the Food Network and HGTV.

It is a major directional shift for AT&T which squared off with the Justice Department less than three years ago in an antitrust fight when it wanted to acquire Time Warner Inc. That was a fight that AT&T won.

However, a multitude of streaming services continue to encroach on traditional broadcast media companies which have sought strength through mergers. They are also pursuing new avenues into streaming entertainment.

AT&T operates HBO Max and Discovery created its own streaming service.

In the all-stock deal, AT&T will receive $43 billion in a combination of cash, debt securities, and WarnerMedia’s retention of certain debt. AT&T shareholders will receive stock representing 71% of the new company and Discovery stockholders will own 29% of the new company.

The new company will be in direct competition with streaming services assembling a growing arsenal of original media content. Those include Netflix, Amazon, Apple, Disney and Comcast. Discovery launched a standalone streaming service called discovery+ this year.

The new media company will be able to invest more in original streaming content to compete, the companies said. It will house almost 200,000 hours of programming and bring together more than 100 brands under one global portfolio, including: DC Comics, Cartoon Network, Eurosport, Magnolia, TLC and Animal Planet.

Discovery President and CEO David Zaslav will lead the new company. The new company’s board will have 13 members, seven will initially appointed by AT&T, including the chairperson. Discovery will initially appoint six directors, including Zaslav.

The deal is expected to close by the middle of next year. It still needs approval from Discovery shareholders. AT&T stockholders don’t need to vote on the transaction.

_____

AP Business writers Anne D’Ínnocenzio and Michelle Chapman contributed to this report.

Today’s Top Stories

AP

Body bags lie at the scene where a tractor trailer with multiple dead bodies was discovered, Monday...
The Associated Press

AP sources: At least 40 people found dead in back of tractor trailer

In a presumed migrant smuggling attempt, a U.S. official says at least 40 people were found dead in the back of a tractor-trailer on Monda in southern Texas.
21 hours ago
An image taken from a video posted by  Robert Nightingale, who was a passenger aboard the Amtrak tr...
Amy Simonson, Steve Almasy, David Williams and Pete Muntean, CNN

3 killed and at least 50 injured when Amtrak train derails in Missouri after hitting dump truck

An Amtrak train derailment in Missouri Monday killed three people and injured at least 50 others.
21 hours ago
praying football coach...
JESSICA GRESKO Associated Press

Supreme Court sides with coach who sought to pray after game

The court ruled 6-3 along ideological lines for the coach. The justices said the coach's prayer was protected by the First Amendment.
21 hours ago
In this undated photo released by Toyota Motor Corp., its bZ4X vehicle is shown during an online pr...
YURI KAGEYAMA AP Business Writer

Toyota recalls electric car for faulty wheel that may detach

The "bz" in the recalled model's name, as well as others in the works, stands for a "beyond zero" series, including sport-utility vehicles of all sizes, pickup trucks and sportscars, according to Toyota.
4 days ago
Committee Chairman Rep. Bennie Thompson, D-Miss., gives opening remarks as the House select committ...
The Associated Press

Ginni Thomas responds to 1/6 panel, hearings stretch to July

The public hearings into the Jan. 6 insurrection at the U.S. Capitol will stretch into July.
5 days ago
jan. 6 committee hearing...
ERIC TUCKER Associated Press

1/6 panel to hear of Trump’s pressure on Justice Department

The hearing Thursday is the fifth this month by the House committee investigating the run-up to the insurrection at the Capitol
5 days ago

Sponsored Articles

Tax Harassment...
Jordan Wilcox

The best strategies for dealing with IRS tax harassment | You have options!

Learn how to deal with IRS tax harassment. This guide will teach you how to stop IRS phone calls and letters, and how to handle an IRS audit.
spend a day at Bear Lake...
Bear Lake Convention and Visitors Bureau

You’ll love spending the day at Bear Lake | How to spend a day at Bear Lake

Bear Lake is a place that needs to be experienced. Spend a day at Bear Lake.
Curb Appeal...
Price's Guaranteed Doors

How to have the best of both worlds for your house | Home security and curb appeal

Protect your home and improve its curb appeal with the latest security solutions like beautiful garage doors and increased security systems.
Prescription opioids can be disposed of during National Prescription Take Back Day...
Know Your Script

Prescription opioid misuse | How to protect your family from the opioid epidemic

Studies have shown that prescription opioid misuse has increased since COVID-19. So what do you need to know about these opioids?
Follow @ikeyospe...

Tax Tuesday: The Most Common Mistakes People Make When Filing Their Taxes

Fortunately, for most average earners, they will not end up owing overpayments received for the Child Tax Credit in 2021.
Follow @ikeyospe...

Tax Tuesday: How will last year’s child tax credits affect you?

Fortunately, for most average earners, they will not end up owing overpayments received for the Child Tax Credit in 2021.
AT&T, Discovery join media houses as cord-cutting encroaches