Q&A With AT&T's John Stankey on Streaming Strategy
By Joe Flint
John Stankey, the chief operating officer of AT&T Inc.,
predicts the criticism the company is facing over its media
strategy will fade away once it launches a new streaming-video
product next year.
In an interview with The Wall Street Journal, Mr. Stankey
defended the company's strategy and said AT&T doesn't plan to
sell its struggling satellite TV unit, DirecTV. Activist investor
Elliott Management Corp. has criticized AT&T for shifting its
plans in streaming video and for executive turnover, among other
Below are additional, edited excerpts of the interview, in which
Mr. Stankey touches on the rollout strategy for HBO Max, the new
streaming service, and how he is handling the scrutiny of his new
WSJ: Will HBO Max be at a disadvantage because it is priced
higher than rival streaming services such as Netflix, Disney+ and
Mr. Stankey: There's a reason why HBO and WarnerMedia took a
record-setting number of Emmys. I believe if you can put something
out there of higher quality and higher consistency, more emotional
connection and better curation, [it] should warrant a slightly
higher price. And I don't want to shy away from that in the market.
So I don't know that there's a right price or a wrong price. It's
up to the customer to decide whether the price is fair.
WSJ: Why did you switch from planning a three-tiered streaming
service to the current plan of a single offering?
Mr. Stankey: Our intent was always if there was going to be a
lead offer in the market, it was going to be a very full-featured,
robust offer that incorporated the maximum amount of content we'd
bring to the market....Through discussions with the leadership, as
we've gone through refinements...the simple decision is, "Let's be
clear, we're going to be in the market [with] one price, one
product," and that is where we're going.
WSJ: Will people who subscribe to HBO on regular TV be able to
sign up for HBO Max easily without cutting the cord?
Mr. Stankey: We very much anticipate and want this to be a
distributor-friendly product and we're out talking with our
distributors right now. We think it's good for you, as the
customer, to have as little friction as possible to get to it. We
think it's good for the distributors because if you, as a customer
of their product, spend more time on a product or service that
they're billing and bundling to you, then that'll be good for your
relationship with your base pay-TV package.
WSJ: Will HBO Max carry all the movies HBO does, or will there
be contractual difficulties that prevent that?
Mr. Stankey: I think what you're going to see in this
offering...is an industry-leading high-quality theatrical offering.
It's going to be really a distinguishing characteristic of this
product. As you go and do consumer studies [and look at what they
want], they feel a bit overwhelmed right now by the volume of
scripted [programming] and the significant investment of time that
engaging in a new piece of content takes.
WSJ: Who will replace you as WarnerMedia CEO now that you're
taking on the chief operating role at AT&T?
Mr. Stankey: I'm not looking to find my successor right at the
moment. I think my priorities right now moving into this job are to
get the advertising business, the communications company and the
media business working as closely and in as coordinated a fashion
as possible....There may come a time down the road where it makes
WSJ: Are you surprised at the level of management turnover at
WarnerMedia after AT&T acquired it?
Mr. Stankey: Sometimes you want the person to stay, but they
look at it and say, "This isn't my cup of tea. The deal has
changed, so to speak." Or, "My sandbox has changed." Or, "I'm not
as motivated if I don't get to control as many things." And so
there's multiple reasons to leave. Sometimes it's because the
company doesn't see a match, and sometimes it's because the
individual doesn't see a match. Could there have been a different
outcome if individuals maybe looked at things and said, "Yes, I'm
totally bought into this direction where the business is going"?
WSJ: What are you most looking forward to as you navigate these
Mr. Stankey: When we put [HBO Max] out there and customers start
to buy it, that's going to be a really proud day for me. It's going
to be a really proud day for this organization. I think a lot of
noise goes away when that happens because at the end of the day,
most people want to come into work and feel like they're doing
something that's meaningful and there's nothing better than having
somebody else use your product and say, "I love it. That's great. I
want to buy it. I told my friends to get it."
Write to Joe Flint at firstname.lastname@example.org
(END) Dow Jones Newswires
September 25, 2019 13:12 ET (17:12 GMT)
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