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In an interview that aired on Monday, Malone said his previous reservations HBO Max’s ability to be a dominant player in the crowded digital streaming landscape is addressed once AT & T.The own service is under the same roof as Discovery.
“I thought they would have a hard time getting the hoped-for subscription growth in the US. And I think that’s actually true,” said Malone, a Discovery board member whose share of voting rights in the company is more than 25%.
“I think we will not only be the third platform of its kind, but I think we will be very competitive with the other two when it comes to meeting the world’s entertainment, curiosity and information needs, basically worldwide Platform, “said Malone.
Disney + ended the second fiscal quarter with 103.6 million subscribersaccording to the company. Netflix announced last month that it had nearly 208 million subscribers worldwide.
AT&T announced in April that HBO and HBO Max combined had 44.2 million subscribers in the US and nearly 64 million worldwide.
“For me, the problem with HBO Max is that at that point it wasn’t possible to go international. Combining it with Discovery, given Discovery’s existing presence, was a huge presence in 200 countries around the world with a great brand,. .. for me, that’s the big plus, “said the cable television pioneer and longtime chairman of Liberty Media.
Malone commented on the deal announced last week between Discovery and WarnerMedia from AT&T, the telecommunications giant, in a comprehensive interview with CNBC Acquired less than three years ago.
If the transaction receives regulatory approval, WarnerMedia’s various media and entertainment properties, including CNN, HBO and the Warner Bros. studio, will be spun off from AT&T and combined with Discovery’s brands such as HGTV, Food Network and Discovery Channel .
It would position the new company – which has not yet been given a new name – as a stronger competitor in the highly competitive streaming video wars. In addition to HBO Max from WarnerMedia, Discovery + Signature Direct-to-Consumer-Platform, Discovery +, started in January.
David Zaslav, CEO of Discovery, told CNBC last week that he thinks the combined company can Ultimately, it gets 400 million subscribers to streaming video worldwide – significantly more than any rival.
“Netflix is a great company, Disney is a great company, but we have a portfolio of content that is very diverse and generally engaging,” said Zaslav, who will lead the new company.
Malone said he has confidence in Zaslav’s management skills and generally believes the connection between Discovery and WarnerMedia is beneficial. He also said he had no qualms about giving up his Discovery shares with super-voting as part of the deal.
According to FactSet, Malone owns more than 93% of the discoveries Class B Shares that make up 10 votes per share compared to one vote per share for Class A. His ownership of these shares enables his significant voting rights in the company. Discovery also has a third class of stocks known as Series C.
The combined WarnerMedia Discovery will only have one type of warehouse.
“My reaction was okay that I thought the alphabet soup we had served its purpose had protected the company and given it a long run for a few years. It was time when its usefulness ran out, so I agreed “said Malone, whose Liberty Media spun off its stake in Discovery Communications into a separate unit in 2005.
AT & T’s decision to outsource WarnerMedia signaled the end of his attempt Linking a content-producing asset to a cell phone company.
Malone praised John Stankey, CEO of AT&T, for pulling the plug on this integrated experiment that some observers questioned from the moment the deal was struck originally announced in 2016. AT&T completed the acquisition of Time Warner in 2018 following a regulatory and judicial dispute.
“John Stankey showed a hell of a lot of courage in making this decision at this point because he was really chasing two capital-intensive, very competitive rabbits,” said Malone.
Stankey replaced Randall Stephenson as CEO of AT&T. in July 2020. He had been president and chief operating officer.
“”[Stankey’s] The idea of focusing AT&T on its primary, traditional business and allowing other managers to pursue direct consumer opportunity with a different balance sheet was a bold decision, “said Malone.