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   Technology StocksAT&T

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From: Jon Koplik11/8/2020 12:46:27 PM
1 Recommendation   of 4271
Bloomberg -- Second Breakup of AT&T / telecom giant is trying to unwind much of its M&A spree ...............

November 6, 2020

The Second Breakup of AT&T

The telecom giant is trying to unwind much of its M&A spree, but finding buyers hasn’t been easy.

By Scott Moritz

AT&T Inc. has been called many things over its 135-year history: Ma Bell, monopoly, media conglomerate.

The company, which traces its roots to the patent rights of telephone inventor Alexander Graham Bell, was the dominant phone company for much of the 20th century. So dominant, in fact, that it was broken up in 1982 as part of an agreement with antitrust authorities. But those businesses eventually began to merge, culminating with SBC Communications -- one of the so-called Baby Bells -- acquiring AT&T in 2005 and taking the name.

That wasn’t the end of it. What followed was a streak of deal-making that turned AT&T into a new behemoth spanning television, media and advertising. After a failed attempt to acquire T-Mobile, the company bought satellite-TV provider DirecTV in 2015 for $49 billion, becoming the biggest provider of pay television. It purchased Time Warner in 2018 for $85 billion, making Ma Bell the improbable parent company of HBO, CNN, Warner Bros. and DC Comics. The carrier also made smaller deals, such as the 2018 acquisition of AppNexus, an online ad platform.

This time around, it isn’t the government pushing to slim down the company -- though the Justice Department did unsuccessfully oppose the Time Warner deal -- but its own investors and Chief Executive Officer John Stankey.

Stankey took the helm in July, putting him in charge of a company with heavy debt and a media business that was ravaged by the pandemic. AT&T also was shunted to No. 3 in the wireless-phone business this year, following T-Mobile US Inc.’s acquisition of Sprint Corp. The company had just launched HBO Max, an attempt to take on Netflix Inc. and Walt Disney Co. in streaming, but perhaps the most urgent matter was undoing some of the work of his predecessor.

The last CEO, Randall Stephenson, had spent much of his 13-year tenure obsessed with deals. He kept a color-coded roster of potential companies he wanted AT&T to buy, leading to 43 acquisitions.

Now Stankey has his own to-do list: things he wants to sell.

“It’s going to keep us busy for a little bit of time.”

Critics such as activist investor Elliott Management Corp. have urged AT&T to focus on its subscriber services and walk back its go-big-or-go-home M&A strategy by divesting acquisitions, including DirecTV.

“When you look at what’s worked or hasn’t worked in telecom, you see that conglomerates and empire building has not been rewarded by the marketplace,” said Todd Lowenstein, chief equity strategist with the Private Bank at Union Bank.

Stankey, who has spent his entire 35-year career at AT&T, may be an unlikely person to dismantle AT&T’s acquisition empire. He rode shotgun as a top captain during Stephenson’s decade of agglomeration. The executive had a hand in creating some of the current problems and he calls them out directly: Last month, he acknowledged that pay-TV providers like DirecTV will probably face years of cord cutting before they hit bottom.

Now, more than 100 days into the job, he says his plan of attack is to focus on three key growth areas: wireless -- particularly 5G -- where there’s hope for new consumer and business applications; fiber-optic network connections to accommodate surging data traffic; and HBO Max, the online streaming future of AT&T’s video ambitions.

As for new acquisitions, don’t expect much beyond opportunistic purchases, Stankey said in an interview in September. “Right now this management team is focused on getting execution right and moving the distractions elsewhere,” he said. “It’s going to keep us busy for a little bit of time.”

Last month, AT&T got $1.1 billion for its stake in Central European Media Enterprises. The company has already sold office buildings and a stake in Disney’s streaming service Hulu. It also got nearly $2 billion from the sale of its Puerto Rico phone business earlier this month.

The company is aiming to pay down debt and cut $6 billion in annual costs, partly through slashing thousands of jobs.

But AT&T still has plenty of potential businesses to sell or scale back. The question now is how big an asset sale it wants to have -- and who may be interested in buying.


The biggest priority is DirecTV and AT&T’s other pay-TV operations, which have been hemorrhaging customers. AT&T has been exploring options for DirecTV for more than a year, but finding a buyer for the whole business seems unlikely.

A combination with Dish Network Corp., the nation’s other satellite-TV provider, is one scenario. But reducing the industry to a single player would draw antitrust scrutiny, especially since rural customers have few other options. A proposed combination of the two businesses was shot down by the Federal Communications Commission and the Justice Department in 2002.

Instead, AT&T is trying to sell a stake -- and possibly control of the business -- to outside investors. a move that could take some of the drag off AT&T’s performance. But the ice cube is melting fast: Pay-TV revenue fell by more than $1 billion, or 10%, in the third quarter.

Apollo Global Management Inc. has been in discussions about such a transaction. And Bloomberg News reported this week that former Citigroup Inc. rainmaker Michael Klein could do a deal through his blank-check company Churchill Capital Corp. IV. Ideally, an agreement would let AT&T remove DirecTV from its books while maintaining access to some of its cash flow.

But a deal is expected to value DirecTV at only about $15 billion when final bids are accepted next month. That's less than a third of the price AT&T paid five years ago.


AT&T’s DirecTV Latin America business suffers some of the same problems as the U.S. operations, only with an even more erratic political backdrop. The 2015 acquisition of DirecTV included satellite businesses in South America and the Caribbean -- an entity that was renamed Vrio. The unit’s biggest problem was its Venezuela pay-TV business. During the country’s political turmoil, the service was shut down after getting caught between U.S. restrictions and the local government.

AT&T tried but failed to spin off part of Vrio in an initial public offering. Then, after reducing the size and price of the offer, AT&T abandoned the move. For the past two years, the falling value of the satellite-TV business has made prospects of unloading the business even dimmer.

Warner Bros. Interactive Entertainment

Unlike some of its businesses, AT&T’s video-game division would be a prized asset for a number of potential buyers. The company has reportedly explored a sale of the operations, which are estimated to be worth $4 billion. But AT&T recently pulled the business off a list of non-core assets that it's willing to part with.

The unit, whose video games include titles like Harry Potter: Wizards Unite and Mortal Kombat 11, attracted interest from several major companies. But with the gaming industry booming during the pandemic -- and AT&T facing the complications of wanting to retain licensing rights -- the company may have decided the division was worth keeping for itself.


The animation video service was the first step in AT&T’s massive pivot to media six years ago. Crunchyroll was acquired through the company’s newly formed joint venture with the Chernin Group, called Otter Media. The name is derived from the abbreviation OTT, for content delivered via the internet “over the top” of a traditional platform. Since then, just “streaming” has become the more popular term.

AT&T bought out the remaining stake in Otter Media from the Chernin Group in 2018. More recently, the telecom giant has had second thoughts. Last week, the Nikkei business daily reported that Sony Corp. was in final talks to acquire the service in a deal worth close to $1 billion.


CNN is one of the more controversial businesses that AT&T acquired when it absorbed WarnerMedia in 2018, with the president regularly assailing the cable-news network on social media. It's also been the source of takeover speculation, with Jeff Bezos seen as a potential buyer. But Stankey said in September that CNN was one of the pieces of the WarnerMedia structure that are “more tightly wound together than they were before.” In other words, selling it would seem less likely.


AT&T had high hopes for the AppNexus digital advertising unit it acquired for $1.6 billion in 2018. Named in a nod to Alexander Graham Bell, Xandr was going to be an advertising network that all pay-TV providers could use. Ad-industry veteran Brian Lesser was hired to run the operation, and Stephenson told investors that the business would bring in $2 billion in new revenue by using customer data to deliver targeted ads.

Those fortunes didn’t materialize. Lesser left, and now it’s up for sale as new WarnerMedia chief Jason Kilar brings in another ad team.

Regional Sports Networks

AT&T has four regional sports networks, or RSNs, which include rights to teams such as hockey’s Pittsburgh Penguins, basketball’s Houston Rockets and baseball’s Seattle Mariners.

Though live sports are still the closest thing to must-see TV these days, owning RSNs has increasingly become a headache. Sports leagues have sought ever-increasing sums for rights to their games, and subscribers aren’t as reliable as they once were. Sinclair Broadcast Group Inc. just wrote down its RSNs by $4.23 billion, an admission that it overpaid for the cable channels, which it only acquired last year.

Looking for cash to pay down debts, AT&T had hoped to sell its RSNs and cash in on their $1 billion in estimated value. The company sought bids last year, but a buyer didn’t materialize. This year, with sports still trying to bounce back from Covid-19, a sale seems even less likely.

Digital Life

In a bold attempt to take on home-security giant ADT Inc., AT&T launched its own “smart home” security and monitoring venture in 2013. While the effort was intended to explore opportunities beyond its wireless service, the timing and model may have been wrong. Homeowners were already moving away from expensive security services and buying do-it-yourself systems or products like Ring from Inc. or Nest from Alphabet Inc. Four years into the venture, AT&T started looking for ways to get out.

AT&T Mexico

Stephenson crossed borders and ended a decades-long friendship with his onetime mentor Carlos Slim by becoming a direct competitor for mobile customers in Mexico. AT&T bought wireless carrier Grupo Iusacell SA for $2.5 billion in 2015 and expanded the service to cover most of Mexico by 2018. But Covid-19, foreign-exchange rates and the dominance of rival America Movil in Mexico has kept the investment unprofitable and difficult to justify.

So what does Stankey do now? Holding out to get top dollar for some of these assets might not be the right approach, said Colby Synesael, an analyst at Cowen.

Stankey just needs to “rip the Band-Aid off and move on,” Synesael said. In other words, take what he can get.

“I think it has become obvious to him that he needs to do it. And the sooner he does it the better,” Synesael said. “He doesn’t want to spend his entire CEO tenure undoing what he and Randall did in the past. Get it done now so he can concentrate on other initiatives.”

-- With assistance by Liana Baker, and Nabila Ahmed

© 2020 Bloomberg L.P.


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From: Jon Koplik12/8/2020 2:52:58 PM
   of 4271
WSJ -- AT&T Boss Defends Plans to Stream Warner Bros. Films Upon Release .....................

Dec. 8, 2020

AT&T Boss Defends Plans to Stream Warner Bros. Films Upon Release

CEO John Stankey expects coronavirus pandemic to scare many people away from theaters

By Drew FitzGerald and Joe Flint

AT&T Inc. Chief Executive John Stankey defended the decision to release all Warner Bros. movies online the same day they hit theaters next year, arguing that the film producer had to tweak a 2020 playbook that wasn’t working during the coronavirus pandemic.

The telecom company’s Warner Bros. unit said last week that it will release its entire 2021 film slate on HBO Max, a new film and television library designed to compete with online services such as Netflix and Disney+. The plan covers 17 movies from the science-fiction epic “Dune” to another installment of the “Matrix” franchise.

The choice shocked a film industry accustomed to releasing big-budget films in stages, with cinema owners getting the first bite. But U.S. box-office ticket sales have cratered since coronavirus-related restrictions shut down many venues. Those that reopened are struggling to attract large audiences.

“We know we probably needed to try something different,” Mr. Stankey said Tuesday during a virtual investor conference hosted by investment bank UBS Group AG. “Our feeling was, in the theatrical business, based on our best discussion with experts, we were going to be in a situation where the psyche of the population and people’s willingness to go back into large venues­ -- that’s going to be a little bit of a prolonged recovery.”

Hollywood and much of the creative community has reacted angrily both to Warner Bros.’s strategy and to the short notice its executives gave their business partners. Theater owners fear that releasing the movies simultaneously on HBO Max and the big screen will drive a stake through their business.

Warner Bros. has countered that this is a short-term move for 2021 as the coronavirus keeps many would-be moviegoers at home and theaters in big cities shut. HBO Max will host the movies for only their first month of theatrical release before the films follow their usual distribution pattern.

Director Christopher Nolan, whose credits include “Tenet” and “The Dark Knight,” criticized the Warner Bros. strategy, telling the TV show “Entertainment Tonight” that the company is using movies “as a loss-leader for the streaming service.” He added: “It’s not the way to do business and it’s not the best thing for the health of our industry.”

“Tenet” is among the movies that Warner Bros. released in theaters this year after several pandemic-related delays. The strategy yielded some box-office revenue abroad but underperformed in the U.S.

Over the summer, Universal Studios and AMC Entertainment Holdings Inc. agreed to shorten the theatrical window before movies appear online. The deal ended a dispute after Comcast Corp.’s Universal made “Trolls World Tour” available as a $20 online rental on April 10, the day it had been scheduled to open in theaters.

Walt Disney Co. offered “Mulan” on Disney+ in September for an extra $30 fee and later made the film available free on its streaming service.

There are also financial concerns for talent who have deals that tie their compensation to a film’s theatrical performance. Warner Bros. has said talent with such agreements will be compensated from the license fees HBO Max will pay to carry the films during their first month of release. However, talent agents are concerned that actors and producers could be hurt by self-dealing between the studio and HBO Max.

Mr. Stankey, who ran WarnerMedia for nearly two years and took the top AT&T job in July, brushed aside those complaints as chatter that often follows a market-disruptive innovation.

“Any time you’re going to change a model, I know it creates a degree of noise,” he said Tuesday. “Ultimately, rational parties will step back and look at this and say, giving theater owners a predictable release of content over the next several months that they can plan around and start to work their business around is a good thing for them.”

The investment community has reacted less dramatically to a decision that threatened theatrical revenues that were already at risk because of the pandemic. AT&T shares have climbed about 3% since the company announced the new strategy. Many Wall Street analysts are focused on the success of HBO Max, which was launched in late May.

Mr. Stankey said Tuesday that HBO Max will count about 12.6 million activated accounts by Wednesday, after ending September with 8.6 million. It had previously set plans to debut “Wonder Woman 1984” on the service when it hits theaters on Christmas Day. The service has also benefited from a deal with Inc. giving customers direct HBO Max access through the e-commerce company’s platforms.

“The market has shown a clear preference for go-big-or-go-home digital strategies,” media-research firm MoffettNathanson wrote in a recent note to clients called “AT&T & U.S. Theaters: Suicide Squad?” a reference to another Warner Bros. title. “AT&T is, come hell or high water, going to drive traffic to HBO Max.”

Write to Drew FitzGerald at and Joe Flint at

Copyright © 2020 Dow Jones & Company, Inc.


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From: Jon Koplik3/27/2021 8:11:08 PM
   of 4271
Barrons / comments on AT&T (today) ...........................................................

(This was in : Yes, You Can Retire on Dividends. 10 Stocks to Build an Income Stream for the Long Haul. )


AT&T (T) is one of the more-discussed stocks among dividend investors, as its yield, at about 7%, is much higher than most U.S companies. A concern that many investors have is the company’s hefty debt load.

Such a high yield can be a reason for investors to exit, but the entertainment, tech, and telecom conglomerate has a long history of paying a dividend -- ­it’s a member of the S&P 500 Dividend Aristocrats -- ­and some analysts like its content library and foray into streaming.

Company executives are showing their support for the dividend. In a March 12 release outlining the company’s strategy and financial outlook, CEO John Stankey said in part that AT&T is “committed to sustaining the dividend at current levels and utilizing cash after dividends to reduce debt.” Chief Financial Officer John Stephens expressed a similar commitment to the dividend at a conference on March 8. “With $26 billion of free cash flow after [capital expenditure], there’s plenty of money to pay out the dividend,” he said.

The last time the company declared a quarterly dividend increase occurred in December 2019, more than a year ago, boosting it by a penny, to 52 cents a share. But AT&T looks like it’s on course to at least sustain the dividend.




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From: Jon Koplik4/21/2021 11:12:11 PM
   of 4271
Barrons / AT&T Earnings Preview : HBO Max Is the Only Thing to Watch ..................................................

Earnings Preview

April 21, 2021
5:13 pm ET

AT&T Earnings: HBO Max Is the Only Thing to Watch

By Nicholas Jasinski

5G. Fiber. HBO Max. That’s all AT&T executives want to talk about. Only one of those things has moved the stock lately, however, and that’s HBO Max. That, and the company’s commitment to its hefty dividend. Keep that in mind when AT&T reports its first-quarter earnings on Thursday morning.

AT&T is expected to report a profit of 53 cents a share, down 16% from a year ago, on sales of $42.7 billion, about equal to the year-ago period. After one-time costs and profits, AT&T’s adjusted earnings per share are forecast to come in at 78 cents, down 8% from a year ago. And like most companies this earnings season, the company will likely top earnings estimates.

The focus, however, will be on HBO Max. The streaming service stole the show at an investor day AT&T hosted last month, with a significantly higher long-term subscriber target the key takeaway from the event. Management said that they expect to have up to 150 million streaming subscribers on HBO and HBO Max by 2025, versus a previous forecast -- ­from late 2019 -- ­of up to 90 million.

The services had a combined 61 million subscribers at the end of 2020. Expect that number to get bigger. Credit Suisse analyst Douglas Mitchelson forecasts that HBO Max added 1.1 million subscribers in the first quarter -- ­ahead of consensus­ -- based on the app’s 8.8 million downloads in the U.S. That’s ahead of all other U.S. streaming services in the quarter, according to Mitchelson, and well above the 1.4 million HBO app downloads in the year-earlier period.

That would be good news for AT&T. The market lately has valued streaming services on revenue multiples and subscriber growth alone, so the fact that AT&T will almost certainly lose money on the service -- ­the company said last month that it expects the service to break even in 2025­ -- won’t matter. Netflix (NFLX) stock has long traded predominantly on its subscriber numbers, while ViacomCBS (VIAC) and Discovery (DISCA) stocks were boosted by their management’s streaming-service targets in recent months, before their spectacular declines after the blowup of Archegos Capital Management.

It’s not that AT&T’s other businesses don’t matter. But wireless growth, if it’s good, will probably be written off because of the generous promotions and subsidized smartphones the company offered to both new and existing subscribers. Warner Bros. and Turner, AT&T’s non-streaming entertainment assets, will continue to be negatively impacted by the Covid-19 pandemic and long-term cord-cutting trends, and are unlikely to shock anyone. Also expect to hear plenty from management about their network investments, which include a $27 billion C-Band spectrum bill and an additional $6 billion to $8 billion to deploy that new spectrum. And above all, AT&T management will underline their commitment to maintaining the company’s dividend -- it currently yields 7% annually -- ­and to paying down debt.

These are long-term issues, and barring any surprises, AT&T stock’s reaction to its report on Wednesday may very well come down to a beat or miss from HBO Max, with the twitchy market more focused on AT&T’s streaming business of late rather than on the company’s telecom businesses.

It can worry about the rest later.

Write to Nicholas Jasinski at

Copyright © 2021 Dow Jones & Company, Inc.


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To: Jon Koplik who wrote (4245)4/22/2021 9:56:45 AM
From: robert b furman
   of 4271
Earnings are out this morning:

Strong Earnings and subscriber growth in both postpaid wireless and HBO growth.

Pension fund adjustment boosted earnings , so a bit of a financial tweaking, but aggressive pricing allowing them to punch their weight.
Fiber optic internet subscriptions strong. Ditto pastpaid wireless and HBO Max.

Looks like Stanke is doing a great job of growing the business, amongst two other aggressive competitors.

I still maintain that T has the better network. VZ has the better false advertising claims and T Mobile has the worst coverage in the nation.

Bottom line it adds up to strong subscriber growth in all sectors.

A far better showing than Netflix managed.

The $14.99 HBO monthly charge is slowing being reached by other competitors.

T just needs to charge a fair price for a superior service and the world will come to your door step.

Slow managed growth and the selling off of their many assets when a fair price is received.

No doubt the real estate values of their real estate holdings have seen appreciation.

Now to further debt reduction, get it done and aim that growing cash flow to stock buybacks, but get the debt reduction DONE!

Hello 40's when that is reached!


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From: therealtiger5/8/2021 10:36:45 PM
   of 4271
Will this company go bankrupt because of heavy debt ? will they able to give dividends in coming 5 years ?

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To: therealtiger who wrote (4247)5/9/2021 10:43:08 AM
From: robert b furman
1 Recommendation   of 4271
Hi Tiger,

No and yes.

Solid cash flow, and not over discounting their superior network will maintain their oligopoly advantage.

I have been a Direct TV subscribers for years. That includes HBO which has now morphed into a no extra charge HBO MAX.

I have read all of the naysayers about T's excessive debt,and failed cable TV subscribers. That doubt has extended to their growth of HBO Max.

I can now tell you that my subscription of Direct TV and HBO MAX s ongoing and the now almost monthly release of a new movie for free, is very enjoyable.

Would I go to the Movies and buy overpriced popcorn to see Mortal Kombat. Nope never.

Did I watch the new movie and enjoy seeing a movie I'd never pay to see? YOU BET!

I think the HBO MAX is a subscriber winner and surely makes my subscription very sticky.

I did not have that opinion before the HBO MAX launch, but after seeing Mortal Kombat, Greenland, Wonder Women, Justice league, Super Man and Louis, King Kong vs. Godzilla are all movies I'd never go to a theater to see, but have had an enjoyable evening watching ALL FOR NO EXTRA EXPENSE.

IMHO it is a subscriber grower with very little expense.

HBO MAX is a winner to me.

There are so many nay sayers on T and its debt.

I suspect a lot of the naysayers writing articles are hit jobs, by funds wanting to scoop up high yielding dividend paying stocks.

Keep in mind that T HAS A HUGE COLLECTION OF ASSETS, that are not essential core assets and as the market rewards their value, T will reallocate those resources over a long term into debt reduction.

I'm long and gladly receiving the 6% plus dividend, expecting it to become an even more secure long term dividend payer.

I have owned T for several years and now have a profitable position, that is yielding a very nice return.

When more people confirm what I'm enjoying T will be in the lower 40's and pay a solid dividend that will once again grow.

Debt reduction is still their focus IMO as well if should be!

T's 5G and fiber will be superior products just as their First Net has proven to be. T mobiles spotty coverage is a joke in many rural areas. Verizon is the only real competitor and they have taken on a lot of debt as well.

These Oligopolies will not be stripping their fees in the future.

They all need every bit of their cash flow to build out their systems.

Hope that helps!


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To: robert b furman who wrote (4248)5/9/2021 11:36:19 AM
From: Lee Lichterman III
1 Recommendation   of 4271
I'll take the other side just for grins... My grandparents worked for T from the beginning and thus received free shares with every paycheck. I inherited a ton of it and have been selling consistently for years. I'm nearing finally getting rid of the last of it probably soon.
Yes, they will probably be able to keep the dividend but yes they have huge debt and I feel they are too big to be nimble. I tried to get my father to dump a bunch around 2000 when it was much higher. They completely missed the internet and were slow to embrace cellphones. Now cellphone technology is constantly evolving so soon as they build out 4G, 5G comes along and something will come after keeping them in a constant need to stay in debt to be competitive.
DirecTV was a disaster purchase. I had it when it was $20 a month but when they hiked the price to $100 for just a basic package, I cancelled like millions of others and haven't looked back despite them calling me constantly trying to offer me temporary deals that expire then jack the rate up again.
Lastly, I'm sick and tired of the network agendas. They own CNN and other liberal agenda pushing channels. Name one show on TV that doesn't have an over the top flaming homosexual in it. I'll wait........... Everything is poor minority this or that, anticonservative, proliberal, preachy drivel.
I'll get my dividends from energy, SPYD (heavily weighted in financials in a rising interest rate period), and other stuff.
FWIW, T was $70 a share in 2000, $40 a share a few years ago. It's been in a long term slide for decades. Add in the decline in the dollar and the dividend isn't close to keeping up. You're just losing a little less.

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To: Lee Lichterman III who wrote (4249)5/9/2021 12:26:14 PM
From: robert b furman
2 Recommendations   of 4271
Hi Lee,

Always good to hear the other side from a good trader.

I have it for its dividend income. Direct TV was a disaster.

I don't see people giving up their smartphones and I do see that streaming will become more and more embraced.

When in Wisconsin we project streaming from our laptops onto our TV from our Houston streaming ap.

Many young kids do not have cable, but they live on their smartphone.

T did learn the evolution the hard way.

Thus the selling of part of Direct TV.

When HBO MAX was initially announced it was "very expensive @ 14.99". Then everyone else started bumping up their streaming service prices.

T does have a very good and fast network system as defined by the First Net program that serves first responders. It's quality has been a source of new enrollments from those who use it.

They also indicate that with HBO-MAX the subscribers are more sticky. T's churn is now at record lows - a sign of customer preference of the system's quality.

T's past acquisitions have been poor. The purchase of Time Warner included many non core assets and there are more to be monetized. They have done a good job of debt reduction - with more to go for sure.

I like that they got out of the discounting business and have quality subscribers.

I think they will slowly prove HBO MAX to be gaining market share and acceptance with their user base.

When/If that happens T will be in the 40's and I'll be enjoying a 6.69% yield on the current dividend of $2.08.

Not a dynamo position but it pays nicely on 4 glorious days a year. <smile>

Thanks for your view!


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From: Sr K5/16/2021 12:58:29 PM
   of 4271
AT&T in Talks to Combine Media Assets, Including CNN, With Discovery

Deal would continue consolidation in media business buffeted by cord-cutting and streaming

The talks signal a major pullback by AT&T, which placed a massive bet on media with its 2018 acquisition of Time Warner Inc. for around $81 billion.PHOTO: TING SHEN/ZUMA PRESS

Dana Cimilluca
Drew FitzGerald
Cara Lombardo

May 16, 2021 12:44 pm ET

AT&T Inc. is in talks to combine a big portfolio of media assets, including CNN, with Discovery Inc., according to people familiar with the matter, a deal that would mark a major strategy shift for the telecom giant as the traditional TV business faces prolonged pressure.

The talks, which cover CNN and other parts of AT&T’s WarnerMedia division, including the TNT and TBS cable channels, are advanced, and an agreement could be reached by Monday, the people said. Should there be a deal, AT&T shareholders would own a big stake in the new entity, some of the people said. The people cautioned that a deal isn’t done yet and the talks could still fall apart. Other details of the potential transaction couldn’t be learned.

A deal between WarnerMedia and Discovery, whose portfolio includes its namesake network and HGTV, would further consolidate a media business buffeted by cord-cutting and competition from streaming video.

The talks signal a major pullback by AT&T, which placed a massive bet on media with its 2018 acquisition of Time Warner Inc. for around $81 billion. That deal made it the world’s most indebted nonfinancial company.

Bloomberg earlier reported that AT&T was in talks to combine media assets with Discovery.


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