AT&T’s streaming ambitions have an official timeline. The world’s largest telecom company is launching a direct-to-consumer service in the fourth quarter of 2019 per an 8-K it filed on Wednesday morning.
John Stankey, CEO of WarnerMedia, announced the details at the Vanity Fair New Establishment Summit in Los Angeles. Since AT&T’s $85 billion acquisition of Time Warner in June, Stankey has been figuring out ways to scale HBO beyond its niche audience. The new service will be anchored around HBO content and additional entertainment content.
“From a utility perspective, HBO is one of the best values on market, especially when you look at emotional engagement. Clearly what we want to do here is ensure compelling content on a combined basis,” he said.
The price point has not been disclosed, but expect it to be a lot pricier than a Netflix or Hulu. You won’t be able to subscribe to the service without HBO. CNN will not be part of the package.
Stankey has spent three decades at AT&T and was responsible for the conglomerate’s digital initiatives including DirecTV Now. Since taking the helm of the company’s content group, he has ruffled a few feathers after he insisted in a leaked recording that HBO’s “35% to 40% penetration” was not enough.
Currently, HBO spends about $2.5 billion on content, which pales in comparison to Netflix’s $8 billion.
“The combined offering will not look like anything in the market. It will be a better product,” he said. “Warner Bros, the Turner family, and HBO offer us a tremendous amount of value… I think of the direct-to-consumer platform as another place to put that content.”
“My job isn’t to build another Netflix. It’s to build a compelling amount of content to have people say it’s worth paying that much money.”
Melody Hahm is a senior writer at Yahoo Finance, covering entrepreneurship, technology and real estate. Follow her on Twitter @melodyhahm.