AT&T has agreed to acquire Time Warner for $85 billion – one of the biggest media tie-ups ever. The move, announced Saturday evening, will help AT&T expand beyond wireless and Internet service into programming. Time Warner (TWX) is the parent of CNN, TNT, HBO, the Warner Bros. studio, and other channels and websites.
AT&T, which dates back to the invention of the telephone in 1876, is one of the world’s largest providers of wireless phone and internet service. It also recently acquired the DirecTV satellite TV business, according to news reports. The deal will be subject to a review by government regulators that could take more than a year to complete.
On a conference call with the media, Time Warner CEO Jeff Bewkes and AT&T CEO Randall Stephenson said the two companies have been in talks since August 2016. The two met in New York for a “periodic check-in … and the more we talked, the more the deal fell in place,” Bewkes said. “We have a very common view of the world,” Stephenson added. “This thing just had what we called gravity. We started negotiating terms very quickly.”
Word of the possible deal leaked out on Thursday; AT&T executives were said to be eager to finish the talks before the market opens on Monday morning. Adding Time Warner will help AT&T to diversify its business beyond wireless phone and Internet services. Stephenson has spoken publicly about his desire to own valuable programming. Gaining Time Warner will give AT&T entry into entertainment, news and sports.
Time Warner includes everything from Game of Thrones on HBO, to Anderson Cooper 360 on CNN, to The Big Bang Theory produced by Warner Bros., to March Madness basketball games, aired by several Turner cable channels. With HBO and CNN on one side of the company, and wireless on the other side, AT&T will have more power to shape the future of media.
