AT&T Takes Wraps Off WarnerMedia’s Three-Tiered Streaming Service

Nov 29, 2018  •  Post A Comment

AT&T provided details about WarnerMedia’s new direct-to-consumer OTT service, which is on track to launch in late 2019. Deadline reports that CEO Randall Stephenson previewed the service today as part of a two-hour event for Wall Street analysts at Time Warner Center.

“The still-unnamed WarnerMedia streaming service will include three levels, the company said,” Deadline reports. “It will have an entry-level movie-focused package; a premium service with original programming and blockbuster movies; and a third service bundling content from the first two plus an extensive library of WarnerMedia and licensed content. Pricing or exact launch plans have yet to be revealed.”

Much of the focus was on strategy going forward after completion of the company’s $81 billion Time Warner merger.

“Financially, the company expects earnings per share growth in the low single digits in 2019 as it absorbs the new content operations,” Deadline reports. “It is forecasting total WarnerMedia synergies reaching a run rate of $2.5 billion by the end of 2021. About $1.5 billion of that will be cost synergies, with the remaining $1 billion resulting from additional sales opportunities, lower subscriber churn and higher advertising. The company expects to reach a run rate of about $700 million by the end of 2019, increasing to $2 billion by the end of 2020 and ramping to $2.5 billion by the end of 2021.”

In a press release, Stephenson commented: “We are well positioned for success as the lines between entertainment and communications continue to blur. If you’re a media company, you can no longer rely exclusively on wholesale distribution models. You must develop a direct relationship with your viewers. And if you’re a communications company, you can no longer rely exclusively on oversized bundles of content.”

One Comment

  1. Will the entry level have any programming in color or will it all be old Black and White movies?

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