AT&T to Keep Time Warner's Culture -- WSJ
October 05 2017 - 3:02AM
Dow Jones News
By Joe Flint
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (October 5, 2017).
AT&T Inc. Chief Executive Randall Stephenson said the
telecommunications giant isn't looking to bring a "telephone
company culture" to Time Warner Inc. and "really screw it up" after
it closes its pending $85 billion acquisition of the media
company.
Speaking at a conference Wednesday hosted by Vanity Fair in
Beverly Hills, Calif., Mr. Stephenson said, "We are mindful that we
are buying a business that we don't have a lot of experience." He
added, "I am not a media tycoon" and won't be "reading scripts or
anything."
AT&T's proposed acquisition of Time Warner, whose holdings
include Warner Bros., HBO and CNN, is under review by the Justice
Department, and people close to the process don't anticipate the
deal to close until late October at the earliest. In a sign the
review has reached an advanced stage, AT&T has discussed
potential merger conditions with the government, people familiar
with the situation have said.
During the 2016 presidential campaign, then-candidate Donald
Trump spoke out against the deal, saying his administration
wouldn't approve it because "it's too much concentration of power
in the hands of too few." Antitrust enforcers ultimately make the
decisions on mergers, though presidents can set the tone through
appointments.
Mr. Stephenson also said he isn't planning on changing the
leadership at CNN. The network and its president, Jeff Zucker, have
been a target of Mr. Trump over its coverage of the administration.
Mr. Stephenson stopped short of saying Mr. Zucker would definitely
stay after the deal closes but said when AT&T acquires a
company, it aims to retain successful management teams. CNN "is
having a lot of success" and AT&T's goal is "to keep key talent
in place," he said.
CNN also shouldn't play any part in the Justice Department's
review of the acquisition, Mr. Stephenson said. "I don't understand
what the relevance is of CNN to an antitrust review."
Mr. Stephenson said he believes that additional advertising
revenue can be generated through more targeted commercials on Time
Warner's Turner networks. AT&T monetizes ad revenue at its
DirecTV unit at a rate two to three times greater than other media
companies, he said, through its data on viewers and their
location.
If AT&T is successful at boosting the value of advertising
on the Turner networks, Mr. Stephenson said, one result hopefully
would be fewer commercials. "One of my biggest frustrations in
media and entertainment is the advertising load," he said.
As for consumers, Mr. Stephenson didn't promise lower prices but
suggested it would be a possibility. He noted that prices were
lowered when AT&T acquired DirecTV, and it was able to bundle
telecom, broadband and video together.
"Why do Justice lawyers, antitrust lawyers, like vertical
integration? Because you can do things for the customer that you
couldn't have conceived of price-wise," Mr. Stephenson said.
--Drew FitzGerald contributed to this article.
Write to Joe Flint at joe.flint@wsj.com
(END) Dow Jones Newswires
October 05, 2017 02:47 ET (06:47 GMT)
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