Streaming landscape shifts with $43B AT&T Discovery deal

NEW YORK (AP) — AT&T said Monday it will combine its massive WarnerMedia media assets, which includes HBO and CNN, with Discovery Inc. to create a new media heavyweight in a $43 billion deal.

The deal, which isn't slated to close until next year, will create new publicly traded company that will enter a streaming arena that has been flooded in the past two years with new players including those owned by AT&T and Discovery, which operate HBO Max and Discovery+, respectively. Bigger and more established services, such as Netflix, Disney, and Amazon, remain the ones to beat. Netflix has more than 200 million subscribers globally, and Disney has more than 100 million.

It is a major directional shift for AT&T, which squared off with the Justice Department less than three years ago in an antitrust fight when it wanted to acquire Time Warner Inc. for more than $80 billion. It also marks the second time this year AT&T is divesting a business not directly related to its core broadband and wireless business. In February, the company spun off DirecTV for a fraction of the $48.5 billion it paid for the satellite TV service in 2015.

The deal still needs approval from Discovery shareholders and regulators before it can be finalized. AT&T stockholders don’t need to vote on the transaction.

Here's a look at how the combination is likely to affect viewers, investors, employees and competitors.

VIEWERS

Nothing is likely to change for HBO Max and Discovery+ subscribers for now. AT&T executives said on a call with investors that their plans for HBO Max remain in place. That includes a rumored $10-a-month ad-supported version of the service, expected to be announced this week, and a June rollout in Latin America and the Caribbean.

Going forward, the services could...