AT&T Inc. is an American multinational telecommunications conglomerate based in Dallas, Texas. It is the second largest provider of mobile telephone services and the largest provider of landline services in the United States, and also provides broadband subscription television services through DirecTV.
It is being said that AT&T is has bought the crown jewel of the entertainment Industry after Comcast’s $30 billion takeovers of NBC Universal and Verizon Communications’ serial acquisitions of the Huffington Post and Yahoo.
AT&T is a telecommunications giant and with its buyout of Time Warner at a staggering price of $85.4 billion, will dominate the U.S media industry both producing content and distributing it to millions with wireless phones, broadband subscriptions, and satellite TV connections.
The Boards of both of the boards unanimously approved the deal. Most analysts and investors believe that when America Online bought out Time Warner It was Time Warner’s biggest mistake at the height of the dot-com boom.
Communications regulators believe that this deal needs to be looked into as it is simply too big for one single conglomerate to have so much power concentrated in its hands.
Donald J Trump has openly said that he will make sure that the buyout is canceled and he would block the deal if elected President. The T-V industry is fast losing out to digital media and with the rise of online outlets like Netflix, Amazon Prime and YouTube and the shift of younger customers from traditional media have pressured media companies to seek out consolidation partners.
Declining advertising revenues and drop in cable fees is another reason these media giants want to get bigger. The bigger you are will attract advertisers and service providers.
CNN and Time are flagships of Time Warner seen and heard all over the world and to have them on board will not only add prestige but credibility also for these two outlets are well known for their honesty integrity unbiased and objective reporting.
Content is what really matters and the stronger and greater the content audience numbers will increase manifold. The greatest priority is finding new ways of reaching consumers and generating advertising revenue.
ESPN and Disney are also facing similar problems with Disney regarded as one of the strongest content company with brands like Pixar, Marvel, and Lucasfilm has been grappling with how to overcome challenges facing its network channels.
NBC Universal was bought by Comcast’s for 30 billion which has proved a model for this new world of media deal-making. The Chief Executive Officer of Time Warner Inc, Jeff Bewkes will go down in history as one of smartest in the media industry in the last decade.
Now, Bewkes has found a suitor willing to offer significantly more — $107.50 a share in cash and stock — and done so at a time when media companies are under pressure to strike their own deals. AT&T’s offer represents a roughly 35 percent premium to where Time Warner’s stock was trading before news reports of the merger talks emerged.
Time Warner has a goldmine of cable channels with HBO, one of the most-admired pay-TV channels; Warner Bros. movie studios; and cable channels that include CNN, TNT, Turner Sports, and TBS.
AT&T is on an ambitious drive with this latest acquisition. In 1982 the original AT&T split up and the former so-called Baby Bells t arose from the breakup. The company has spent hundreds of billions of dollars on acquisitions to reconstitute some of its parent’s empire.
That has included buying DirecTV for $48.5 billion, adding satellite TV subscriptions as an additional source of negotiating leverage with content providers, along with the satellite company’s steady stream of cash.
Still, AT&T’s biggest rivals have not stood still. Comcast struck an agreement this spring to buy DreamWorks Animation for $3.8 billion, adding the “Shrek” and “Kung Fu Panda” franchises to its media holdings.
The American media industry is getting bigger and richer. It only remains to be seen in the long run which media giant will swallow up the rest. For the moment It seems AT&T has taken the lead.