Uncertainties related to AT&T–Time Warner merger
The deal, if it gets regulatory clearance, is expected to close in mid-June 2018. However, even if the merger doesn’t get approval from US regulators, Time Warner’s shareholders aren’t going to lose, according to a Wall Street company in a CNBC report.
HBO is a desired asset
According to UBS, Time Warner’s HBO is a highly desirable asset in the current scenario in which media assets are in high demand. Therefore, even if AT&T can’t get ahold of HBO and Time Warner’s other assets, it’s expected that there will be a bidding war between other media companies and Internet-based competitors for HBO. In 2017, HBO’s subscription revenue was $5.5 billion, up from $4.2 billion in 2013.
HBO is home to theatrically released motion pictures, original TV series, movies, boxing matches, occasional concerts, and stand-up comedy shows. Owing to growing demand for original series and sports content, telecommunications and media companies are geared up to bag such media assets.
For instance, the Walt Disney Company (DIS) has made an acquisition offer for 21st Century Fox’s (FOXA) film and TV units FX and National Geographic along with its cable and TV businesses Star Network and Sky Disney. However, Comcast (CMCSA), the largest US cable company, has recently made a higher bid on Fox’s Sky.
Companies such as Verizon, Amazon, and Fox, among others, are also pushing hard to acquire the rights to broadcast NFL (National Football League) games across various digital platforms.