As AT&T’s traditional TV business continues to shed subscribers, the company is hinting at bringing live news and sports to its stand-alone HBO Max service, which will launch next spring.
“And those live elements, unique live sports, premium sports . . . NBA, Major League Baseball, NCAA basketball, those are going to be really, really important elements for HBO Max,” AT&T CEO Randall Stephenson said during an earnings call (via analyst Rich Greenfield). “The same with news, and you can go through the areas of news that we think are very, very important that will do quite well as an element of HBO Max.”
It’s unclear exactly how AT&T will secure the rights to major sporting events, particularly the ones it currently airs on Turner networks such as TBS and TNT, but it’s possible the company will try to negotiate streaming rights as it works out new carriage agreements with TV providers. ESPN has already said it is pursuing a similar strategy to get more major sporting events onto its ESPN+ streaming service.
Either way, the pressure’s on AT&T to build a TV service that can grow over the long term. DirecTV Now, its live-TV streaming package that launched in late 2016, lost 168,000 subscribers last quarter, while DirecTV satellite and U-Verse shed a combined 778,000 subscribers. Even HBO lost U.S. subscribers in Q2.
While AT&T still managed to grow overall revenues by 5.5% last quarter, Variety reports that much of that growth came from the Warner Bros. studio business and from Turner, whose networks are extracting ever-higher carriage fees despite a shrinking pay-TV audience.