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Why AT&T wanted Time Warner

Will ATT buy Time Warner and emanate new media giant?

Why did ATT, a wireless phone company, wish to possess CNN, HBO and Warner Bros.?

The answer has something to do with a ways that phones have altered a lives.

There are also unsentimental corporate concerns. ATT thinks it needs to diversify; wants to possess programming; and wants to keep Time Warner out of a hands of a outrageous rivals. Owning brands like HBO would give ATT a lot some-more leverage.

Related: ATT to buy Time Warner in media mega-deal

The answer to what’s in it for Time Warner is sincerely obvious: Billions of dollars. Analysts have prolonged believed that Time Warner CEO Jeff Bewkes has been scheming a association — a collection of businesses that make TV shows, cinema and web sites, including CNNMoney — for a sale.

What’s in it for ATT? Growth and power. The consistent connectivity supposing by a likes of ATT is absolute and profitable, yet so is content.

Think about a approach we use your phone. Even in a age of Snapchat, we spend a lot some-more time examination media than we spend creation it. And if you’re anything like me, you’re increasingly examination that media right on your intelligent phone and other mobile devices.

These changes have meant a introduction of new ways to compensate for entertainment; new ways to correlate with sports; new ways to discharge news.

That’s where Time Warner comes in.

Owning profitable programming — in this box all from “Game of Thrones” to “The Big Bang Theory” — gives ATT some-more power. It gives ATT some-more change over what a “future of media” looks like.

media shakeup att-twx partnership striking new

Other companies will have to negotiate with ATT to benefit long-term licenses for channels like TNT and a Cartoon Network, a same approach they negotiate with Time Warner now.

As evidenced by a expenditure patterns, it is transparent that a destiny centers around mobile observation of TV, cinema and other forms of video. ATT’s aphorism is “mobilizing your world.” Soon it could supplement “mobilizing your media.”

To be sure, synergy speak during a partnership is infrequently overstated. The betrothed synergies during a catastrophic AOL-Time Warner partnership of a early 2000s unsuccessful to materialize.

But it is easy to suppose connectors between a placement side and a programming side of a residence ATT would be building with this deal. Subscriptions to HBO and news apps from CNN could be sole right alongside wireless use — all bundled as a partial of a customer’s monthly bill.

ATT already sells a combo package of wireless and DirecTV satellite TV. And a association is scheming to launch a streaming chronicle of cable, called DirecTV Now, that will let people tide dozens of TV channels for a monthly fee.

Owning Time Warner could assistance ATT with those ambitions. ATT also gains Time Warner’s 10% seductiveness in Hulu, a streaming video service.

The understanding also elevates ATT into rarefied atmosphere — right alongside Comcast, that owns NBCUniversal.

“ATT appropriation Time Warner creates a good understanding of sense, and it gives Comcast a genuine aspirant with calm and lots of conduit,” wire attention consultant Paul Maxwell told CNNMoney.

“But any genuine outcome depends on supervision OK,” he emphasized.

Related: Donald Trump rips into probable ATT-Time Warner deal

The further of Time Warner could also give ATT a large advantage over Verizon, a primary wireless competitor.

Both companies are using out of ways to grow in wireless, given many households have all a phones they need, and are already tethered to some association for use to those phones.

Programming and promotion benefaction new ways to grow — though, given a problems a media attention is having, that are partial of a reason that Time Warner is adult for sale in a initial place, they are not certain things.

Verizon has shown seductiveness in owning both calm and a record that controls digital advertising, as reflected by Verizon’s squeeze of AOL and a pending squeeze of Yahoo.

Both those deals are a fragment of a distance of ATT-Time Warner.

Article source: http://rss.cnn.com/~r/rss/edition_business/~3/ny3nuQ9XezE/index.html