Breaking News: What AT&T/Time Warner Merger Means for Cord Cutters

What AT&T’s $85B Deal Means for DIRECTV NOW, HBO, Hulu, and Philo

A federal judge approved AT&T’s $85 billion acquisition of Time Warner.

This will have a significant implications on the streaming services, cable channels, and future media acquisitions.

Many argue that if pay TV providers also own the entertainment bundle, that prices will continue to go up for content.

AT&T disagrees. They argue that with Time Warner they can be more cost competitive by owning wireless, video distribution, and content.

They felt they needed the merger to compete with technology companies like Google/Apple/Amazon and streaming services like Netflix.

Earlier this month, AT&T CEO Randall Stephenson announced that if the deal went through they would launch an entertainment-only plan called AT&T Watch for $15 / month or free for AT&T subscribers.

We broke down what this might mean for the different services.

What the AT&T/Time Warner Merger means for AT&T and DIRECTV NOW?

  • AT&T will now own wireless service (AT&T), pay TV service (DIRECTV & DIRECTV NOW), and a bundle of cable channels (HBO, TNT, TBS, CNN, etc.)
  • Because of the approval, AT&T will launch a entertainment-only bundle called AT&T Watch for $15 / month or free for AT&T subscribers.
  • AT&T and DIRECTV NOW customers will likely continue to get HBO at a subsidized price.

What the AT&T/Time Warner Merger means for Hulu?

  • Many expect that this might cause Comcast to challenge Disney’s bid for FOX.
  • Currently, Disney has agreed to acquire most of FOX assets including Hulu, regional sports channels, and 21st Century Fox’s film and TV production companies.
  • Comcast or Disney would become the majority shareholder of Hulu the acquisition.

What the AT&T/Time Warner Merger means for PlayStation Vue, YouTube TV, and Sling TV?

  • There is a risk that AT&T could hold back Time Warner channels from appearing on other services.
  • AT&T may be able to be more aggressive on pricing since they own but content and distribution.

What the AT&T/Time Warner Merger means for Philo?

  • Since AT&T plans to launch a $15 entertainment-only option, Philo may have to compete with a larger company on price.
  • However, Philo is backed by major content providers which may not participate in the AT&T bundle.