AT&T and Discovery Inc. may soon join forces to improve their chances against top competitors like Netflix and Disney in the streaming wars. According to many reports, the two companies are in talks to merge Discovery’s reality TV empire with AT & T’s catalog of cable channels and other media titles to create a new entertainment entity.
AT&T and Discovery are in advanced stages of negotiations and a deal could be reached by Monday, sources said the wall street journal on Sunday. So far, companies have discussed several major players in AT & T’s WarnerMedia division, including CNN and its TNT and TBS cable channels. If they strike a deal, AT&T shareholders would own a significant stake in the new entity, according to the outlet. People familiar with the negotiations said Bloomberg an agreement could be announced as early as this week.
Predictors who spoke to the two media outlets did not disclose the terms of a potential deal and warned those talks could still fall apart before a deal is reached. AT&T and Discovery declined to comment on the matter.
One thing is for sure, the two certainly have enough content to market a joint venture. AT & T’s cable empire includes CNN, HBO, Cartoon Network, TruTV, and Cinemax, among others, as well as the Warner Bros. studio movie roster. Meanwhile, Discovery’s offerings include Food Network, TLC, and HGTV – some of the most frenzy-worthy trashy TVs cable has to offer (and I say this affectionately).
AT & T’s existing streaming channel, HBO Max, has regularly won subscribers since its debut last May despite its chaotic deployment, but it didn’t experience the same explosive growth as Disney + done in its first year. Discovery’s streaming service, Discovery +, is also fairly new to the scene, and both face stiff competition from long-established services like Netflix. So teaming up could definitely give them an edge.
On the other hand, AT&T could shoot itself in the foot here. It is already planning to roll out a cheaper, ad-supported tier of HBO Max. in June, which could deter existing subscribers from sticking to their more expensive plan. If people can also watch their favorite WarnerMedia programming on another streaming service like Discovery +, that’s all the more reason for them. to stop paying the full price for HBO Max. It’s like AT&T is determined to undermine its own sales pitch.