Dan York Named CEO of Cox Media Group

Dan York, former chief content officer at DirecTV and MediaPlay News “Digital Driver,” has been named CEO of Cox Media Group.

York will be responsible for all aspects of managing the company’s media platforms and will oversee CMG’s long-term strategic priorities.

Steve Pruett, who was interim CEO, will continue as executive chairman of CMG. He said York’s success in media, content, distribution, operations, and successfully leading large organizations, makes him essential.

Dan York

“Most importantly, [York] embraces contemporary thinking as the media landscape continues to evolve,” Pruett said in a statement. “We have full confidence he is the right person to lead CMG in the next phase of the company’s growth.”

As CCO at DirecTV, York developed a reputation for being a hard negotiator, including driving programmers to tears during all-night contract proceedings, according to a 2016 Los Angeles Times profile.

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York helped build AT&T’s video business over the past 15 years from a start-up to one of the nation’s largest pay-TV provider and the world’s largest licensor of content. During his tenure he oversaw all content activities, including licensing, operations, strategy, investments, original content, compliance, and ran AT&T’s ad sales and regional sports networks.

Indeed, it was York, who allegedly was instrumental in keeping the Los Angeles Dodgers’ regional cable channel, SportsNet LA, off of former Time Warner Cable (now part of Charter Communications). The heavy-handed tactics resulted in the Justice Department lawsuit against AT&T-owned DirecTV.

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“We all negotiate hard to get good deals,” a veteran TV executive told the Times. “But Dan mashes your face into the cement.”

Despite Highest SVOD Price, HBO Max a ‘Real Bargain,’ AT&T CFO Says

When HBO Max launches later this month (May 27), it will be the one of most expensive high-profile subscription streaming video services at $14.99 monthly — more than twice the price of Disney+ and two dollars more than Netflix’s standard plan. WarnerMedia is offering the service for $12 monthly for a year if pre-ordered before May 27.

That’s still a great deal to AT&T CFO John Stephens. Speaking online May 12 at the virtual MoffettNathanson 7th Annual Media & Communications Summit, Stephens said Max would “quite frankly” attract many more demographics than competing SVOD services.

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Indeed, Max will feature a “Friends” reunion (delayed due to the coronavirus), a “Gossip Girl” reboot and a Grease spin-off, among other original fare.

“So from that perspective, I think it’s something that’s going to be accepted as very high-quality and significant content that goes across the whole family unit or multiple individuals, as opposed to just one demographic. As such, I think it’s at the right price point,” Stephens said.

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The executive said the platform would be tweaked and adjusted based on consumer feedback.

“[We’ll] see how that plays out. We’ll make adjustments,” Stephens said.

WarnerMedia Absorbs Xandr Ad Platform

AT&T continues to rejigger its media operations, combining WarnerMedia and ad platform Xandr for what the telecom claims will be a better advertising value proposition for brands, publishers and consumers. Gerhard Zeiler, chief revenue officer of WarnerMedia and president of WarnerMedia International, will oversee all advertising responsibilities across AT&T.

The merger was foreshadowed last month when Brian Lesser, CEO of Xandr, abruptly resigned, creating some uncertainty about the future the advertising unit.

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​Kirk McDonald, chief business officer of Xandr will continue to lead the unit, reporting directly to Zeiler. The merged goal is to accelerate new advertising formats by 2021 for HBO Max, WarnerMedia’s high-profile subscription streaming video service launching this month. ​

“Now more than ever, we need to simplify advertising and further our marketplace capabilities for our customers,” Zeiler said in a statement.

As the lines between TV and digital video continue to converge, Xandr’s platform aims to make it easier for ad buyers/sellers to find audiences across multiple distribution screens.

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“This is done through one holistic conversation that spans premium content and trusted environments, alongside proven and advanced ad capabilities,” Zeiler said.

Randall Stephenson’s Legacy: Backing Media in Partisan Era

Just hours after AT&T announced that its CEO Randall Stephenson would be stepping down in July after 13 years, President Donald Trump called Stephenson’s departure “great news!” in reference to WarnerMedia’s ownership of CNN, which the president often clashes with.

“Randall Stephenson, the CEO of heavily indebted AT&T, which owns and presides over Fake News @CNN, is leaving, or was forced out. Anyone who lets a garbage ‘network’ do and say the things that CNN does, should leave ASAP. Hopefully replacement will be much better!” Trump tweeted April 24 on social media.

Stephenson’s departure comes as AT&T grapples with shrinking pay-TV subscribers at DirecTV and AT&T U-verse, an online TV misfire with DirecTV Now (rebranded as AT&T TV), and $163 billion in debt — a figure that grew by $5.5 billion earlier this month following a third-party loan during the coronavirus pandemic.

Some have speculated the DOJ’s repeated attempts to nix AT&T’s $85 billion acquisition of Time Warner (and formation of WarnerMedia Entertainment) in 2016 stemmed from the president’s public animosity toward CNN.

“CNN’s job is not to be popular with the president,” Stephenson said at the time of the merger. “CNN’s job is really simple: It’s the job of all media: to hold people in power accountable.”

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Strong words from a CEO who often criticized government regulation, welcomed Trump’s corporate tax cut and was frequently accused of telling Wall Street that he preferred taking care of shareholders over consumers.

Indeed, in the first quarter (ended March 31), AT&T’s dividends paid for common shares totaling $3.7 billion (up 47% since 2017) and the company repurchased 142 million of its common shares for $4.7 billion.

Stephenson made headlines in 2017, when, as National Chair of the Boy Scouts of America, he criticized Trump’s address at the Boy Scouts of America’s annual Jamboree in West Virginia.

Trump had turned his speech into a partisan political rally, criticizing Obamacare, reiterating his 2016 election victory over Hillary Clinton, reportedly asking for greater loyalty from scouts and their parents and criticizing former President Barack Obama for not attending the Jamboree — a tradition among presidents since Franklin D. Roosevelt in 1937.

“Anyone knows his speeches get highly political — we anticipated that this could be the case,” Stephenson told The Associated Press. “Do I wish the president hadn’t gone there and hadn’t been political? Of course.”

Stephenson’s dogged defense of CNN continued despite some concern on Wall Street the global network founded by billionaire Ted Turner could undermine AT&T’s businesses going forward.

“This is one of those issues you just ask, ‘What is the right thing to do?'” Stephenson said at a Wall Street Journal forum as reported by The Dallas Morning News. “And then you do the right thing.”

Craig Moffett, analyst with MoffettNathanson, said Stephenson leaves behind a company that transformed from telecom operator to media conglomerate.

“But the jury is still out if the transformation is for better or worse,” Moffett told CNBC.

AT&T CEO Randall Stephenson Stepping Down; John Stankey Taking Over

In a surprise, AT&T April 24 announced Randall Stephenson is stepping down from his CEO position on June 1, to be replaced by COO John Stankey, former CEO of WarnerMedia Entertainment.

After serving 13 years as chairman and CEO, Stephenson, 60, will serve as executive chairman of the board of directors until January 2021 to ensure a smooth leadership transition.

Stephenson’s career saw the telecom acquire satellite operator DirecTV and then spend even bigger ($85 billion) purchasing Time Warner, including Warner Bros., HBO and Turner. The acquisitions ballooned AT&T’s debt and caused headaches such as the failed DirecTV Now online TV platform (now called AT&T TV), and allegations of inappropriate sexual conduct against former Warner Bros. CEO Kevin Tsujihara.

In addition, consumers are increasingly moving away from traditional linear pay-TV — a reality underscored by AT&T losing almost 900,000 pay-TV subscribers through March 31. With the coronavirus pandemic shuttering Hollywood production, free cash flow may be rising, but WarnerMedia’s markets are shrinking — most notably at the box office.

Stankey’s comments regarding a probable sluggish theatrical market after restrictions are lifted prompted Warner Bros. CEO Ann Sarnoff to respond by telling the media the studio still supported exhibitors and the traditional 90-day box office window.

President Trump didn’t wait to tweet his opinion, calling Stephenson’s departure “great news!” in reference to WarnerMedia’s ownership of CNN, which the president often clashes with.

“Randall Stephenson, the CEO of heavily indebted AT&T, which owns and presides over Fake News @CNN, is leaving, or was forced out. Anyone who lets a garbage ‘network’ do and say the things that CNN does, should leave ASAP. Hopefully replacement will be much better!” Trump wrote.

Stankey’s selection as AT&T’s next CEO completes the final phase of a succession planning process that AT&T’s board began in 2017, which included a thorough evaluation of internal and external candidates.

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The telecom said it engaged in an extensive five-month search process to ensure that the company’s next CEO possessed the “vision, experience, talent and leadership” qualities necessary to deliver on AT&T’s strategic plans.

“Leadership succession is one of the Board’s most important responsibilities,” AT&T director Beth Mooney said in a statement. “After an extensive evaluation, it was clear that John Stankey was the right person to lead AT&T into the future.”

Stankey, 57, has served as president and COO since October 2019. He joined AT&T in 1985 and has more than 30 years of accomplished leadership spanning nearly every area of AT&T’s business, from corporate strategy and technology, to operations and media and entertainment.

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Stankey has served in a variety of roles, including: CEO of WarnerMedia; CEO of AT&T Entertainment Group; Chief Strategy Officer; Chief Technology Officer; CEO of AT&T Operations; and CEO of AT&T Business Solutions.

“I’m honored to be elected the next CEO of AT&T,” Stankey said in a statement. “My thanks go to Randall for his vision and outstanding leadership during a period of tremendous change and investment in the core capabilities needed to position AT&T well for the years ahead.”

Later this year, AT&T’s board will elect an independent director when Stephenson retires as executive chairman in January 2021.

AT&T’s John Stankey Doesn’t Expect Movie Theaters to ‘Snap Back’

With Georgia becoming the first state to publicly announce it would allow movie theaters to re-open on April 27, theater chains such as AMC, Regal and Cinemark remain optimistic business can return to some degree of normalcy by July. AT&T COO John Stankey isn’t so sure.

Speaking April 22 on the telecom’s somber fiscal call, Stankey said WarnerMedia is “rethinking the theatrical model,” adding a return to normal for exhibitors won’t “snap back,” and instead could take extended time as consumers slowly regain confidence that sitting in a cineplex isn’t hazardous to their health.

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“I think that’s going to be something that we’re going to have to watch the formation of consumer confidence, not just about going to movies, just in general about being back out in public and understanding what’s occurring there,” Stankey said.

Will Smith as Venus and Serena Williams’ father, Richard, in biopic ‘King Richard’

Indeed, Warner Bros. has pushed back release of its highest-profile summer tentpole — Wonder Woman 1984 — to August. Other titles have been delayed to 2021 while animated feature Scoob! is headed to premium VOD on May 15.

King Richard, the Venus and Serena Williams’ biopic starring Will Smith as their father, has been delayed to November 2021. The Many Saints of Newark, a “Sopranos” prequel movie, has also been delayed to next year.

Among other superhero movies, The Batman has been moved to Oct. 1; The Flash has been moved up to June 2, 2022, from July 1; and Shazam! 2 has been pushed back to Nov. 4, 2022, from April 1.

“The theater business is an incredibly stressed business [right now] … it’s hard to generate revenue,” Stankey said.

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AT&T: 890,000 Pay-TV/OTT Subs Lost in Q1; Drops Fiscal Guidance

AT&T had a problem with pay-TV subscriber retention before the pandemic. First-quarter fiscal results (ended March 31) suggest COVID-19 hasn’t spared the telecom, with management saying the virus cost upwards of 5 cents-per-share in pre-tax earnings, or about $360 million.

AT&T said it lost 897,000 pay-TV subscribers in the quarter, which include DirecTV and U-verse. It also lost 138,000 over-the-top video subs, which includes recently launched AT&T TV. The company ended the quarter with just 788,000 streaming video subs compared to 1.5 million a year ago. Pay-TV subs totaled 18.5 million compared with 23.4 million last year — a loss of 4.9 million subs over the past 12 months.

“It’s impossible to state the impact COVID-19 is having on all of us,” CEO Randall Stephenson said on the fiscal call. AT&T contends 60% of revenue and 70% of pre-tax earnings come from the company’s core communication business, including enterprise network, broadband and wireless.

“These businesses have proven to be resilient and they help provide a recurring stream of revenue and solid cash flows even in times of economic stress,” COO John Stankey said.

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“Without [COVID-19], the quarter was about what we expected — strong wireless numbers that covered the HBO Max investment, and produced stable [pre-tax] earnings and margins,” Stephenson said in a statement.

The executive said AT&T maintains a strong cash position and balance sheet, with core businesses continuing to generate free cash flow — even in today’s environment.

“In light of the pandemic’s economic impact, we’ve already adjusted our capital allocation plans and suspended all share retirements,” Stephenson said. “As a result, we’re able to continue investing in critical growth areas like 5G, broadband and HBO Max, while maintaining our dividend commitment and paying down debt.”

Regardless, CFO John Stephens said AT&T expects increased cord cutting among pay-TV subscribers, in addition to lower revenue from hospitality businesses such as hotels, bars and restaurants.

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WarnerMedia Parent AT&T Seeks $5.5 Billion Loan; Says Financial Position Remains Strong

With a high-profile subscription streaming video platform HBO Max launching next month, and many of its business segments at WarnerMedia Entertainment idle due to the coronavirus pandemic, AT&T April 7 announced a $5.5 billion term-loan agreement with 12 banks to provide additional financial “flexibility” to what it characterized as an “already strong cash position.” The loans are pre-payable without penalty.

The telecom said it had about $12 billion in cash on hand at the end of 2019. It also ended last year with about $170 billion in debt — much of it accrued from the $85 billion acquisition of Time Warner, whose assets include Warner Bros., HBO and Turner.

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In a regulatory filing, AT&T said the “strength and relevance” of its core subscription businesses (telecom and pay-TV) would provide enough cash from operations to support network investments, dividend payments and debt retirement, as well as the ability to invest in business opportunities that arise as the economy recovers.

The telecom said it expects to generate $2 billion from the expected closing later in 2020 from the previously announced divestiture of television channels in Bulgaria, Czech Republic, Romania, Slovakia and Slovenia., as well as additional proceeds from a number of other real estate and cell tower sales.

The company expects to close the sale of its Puerto Rico and U.S. Virgin Islands operations later this year. AT&T also has a $15 billion revolver in place but said it sees need or plans to use it in 2020.

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While it suspended a stock repurchase program, AT&T said it “looks forward” to continuing to pay a quarterly dividend to shareholders as it has for 36 years. On March 27, the board of directors declared a dividend payable on May 1, to stockholders of record of its common and preferred shares at the close of business on April 9.

The telecom also announced it hold its 2020 annual meeting on April 24 (10 a.m. ET) via webcast only.

AT&T Stops Selling New U-verse Pay-TV Service Subscriptions

As expected, AT&T has stopped selling new subscriptions to U-verse, the telecom’s 14-year-old pay-TV service, in an attempt to move consumers toward upstart online TV service AT&T TV (formerly DirecTV Now).

“To help our employees serve our existing customers, we’re no longer selling U-verse TV. Service for existing U-verse TV customers is not impacted,” AT&T said in a statement on its website.

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AT&T lost more than 3.4 million linear TV subscribers in 2019, including 945,000 subs in the fourth quarter, ended Dec . 31. That included DirecTV and U-verse.

The telecom is pinning much of its video future on AT&T TV and HBO Max — the latter $14.99 monthly SVOD platform slated to launch in May.

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AT&T Giving Subs Free Access to Premium Content

AT&T March 26 became the latest media company offering limited free access to proprietary and third-party content during the coronavirus pandemic.

The telecom is offering DirecTV, U-Verse, AT&T TV and AT&T TV Now subscribers free access to HBO, Starz, Cinemax and Epix into April. Starz and Epix are owned by Lionsgate and MGM, respectively.

Starz will be available from March 26 to April 4, Epix from April 4 to April 16, and HBO and Cinemax available from April 17 to 20.

CBS All Access earlier announced it would give a free 30-day trial to new subscribers.

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The strategy comes as AT&T readies the May launch of HBO Max — the $14.99 SVOD platform it hopes to carry initially on the backs of existing pay-TV subscribers. For the telecom, unfortunately, those subs have been leaving in droves.

AT&T lost 1.2 million streaming video and pay-TV subs in the most-recent fiscal period. It lost 2.9 million subs in the previous three fiscal quarters combined.

And with 3.3 million people filing for unemployment benefits this week — the highest tally since 1982 — due to the drastic economic downturn caused by the coronavirus pandemic, pay-TV might become an unnecessary luxury to millions more.

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