HBO’s own Shakespearean drama “Succession” is starting to look more and more like a documentary. Hollywood is shedding its dead weight and beginning the walk to total consolidation. This week has had its share of speculation as Hollywood giants seek to merge and acquire, from WarnerMedia and Discovery to Amazon and MGM.
AT&T surprised everybody with news that it was going to merge WarnerMedia with Discovery. The process will involve the phone company spinning off WarnerMedia and Discovery into a merged company. AT&T would then step back and use the received $43 billion in cash and bonds to work off some debt.
AT&T purchased Time Warner (renaming it to WarnerMedia) only three years ago for $85 billion. It wasn’t easy, as it faced a long battle with then President Trump and his Justice Department, who sought to block it. AT&T originally sought to control both content and distribution; a practice called (in a whispery Jack Donaghy voice) vertical integration. After winning the fight, AT&T seems to be throwing in the towel.
Deadline reported that Hollywood had one feeling after hearing the news. Relief. AT&Ts brief tenure running one of the highest quality programming (HBO) has been troubled. From massive staff layoffs to culture clashes, many Hollywood insiders felt AT&T never understood the entertainment business. In a controversial decision, AT&Ts management culminated in HBO Max announcing it would release all its 2021 movies on streaming the same day as theaters. This incited swift backlash from important creatives.
David Zaslav, the longtime Discovery boss, will run the merged company. As a result, there are important implications for this new venture. For one, by revenue it will be the second largest media company in the country. Its value could make it a worthy competitor to Disney, but also to Netflix. In the streaming world, this new company (once it is finally, which will take months) will become a notable player with HBO Max and Discovery.
But the streaming wars are heating up even more as Amazon may be looking to buy MGM. These big mergers like 20th Century Fox and Disney are making it harder for once renowned studios like MGM to compete. But for months, MGM has been looking for a buyer, and speculation suggests Amazon may come to their rescue. This move would add 4,000 films to Amazon, including big franchises like “James Bond” and “Rocky.”
The trend for Hollywood studios to buy up more and more companies is growing. As Disney, Amazon, and WarnerMedia collect more and more Hollywood infinity stones, the landscape of the entertainment industry will change rapidly. While it’s probably for the best that a phone company like AT&T is not in charge of something like HBO, these aggressive mergers are making it nearly impossible for boutique studios to gain distribution. Let’s just hope none of them find all 6 stones!