from the dealmaking-for-dealmaking's-sake dept
The AT&T Time Warner and DirecTV mergers were a monumental disasters. AT&T spent $200 billion to acquire both companies thinking it would dominate the video and internet ad space. Instead, the company lost 9 million subscribers in nine years, fired 50,000 employees, closed numerous popular brands (including Mad Magazine), and stumbled around incompetently for several years before giving up.
But that was just the start.
After its tactical retreat, AT&T spun off Time Warner into an entirely new company, Warner Media. Warner Media then immediately turned around and announced a blockbuster merger with Discovery, creating the creatively named Warner Brothers Discovery.
This new company has been a blistering mess as well. Executives there have been so cheap they’ve refused to pay residuals to creators, shuttered numerous popular programs they didn’t want to pay for, and engaged in round after round of additional layoffs to achieve promised “synergies.”
Throughout this whole mess, executives at the new media giant struggled to properly name what they had “created.” AT&T embraced so many different names for its streaming efforts, it even confused the company’s own employees. Three-plus years later and executives at Warner Brothers Discovery still can’t figure out what to name the effort, and are now keen on killing the only brand that means anything to its users:
Warner Bros. Discovery is pushing forward with a plan to drop “HBO” from the name of its flagship streaming service HBO Max.
That decision for the long-planned rebranding of the combined HBO Max and Discovery+ services was partially informed by the company’s belief that “the HBO name turns off many potential subscribers,” Bloomberg reported on Thursday and TheWrap independently confirmed.
Throughout this experiment, the executive brain trust have seemed keen on degrading the quality proposition of their streaming service, removing or burying much of HBO’s legacy content in menus while prioritizing garbage reality TV programming like “F-Boy Island.” At the same time, they’ve been keen to raise rates as quickly as possible to achieve hallucinated synergies of the deal.
Years later and not only are executives still debating what to call this hot mess, they continue to indicate they have no understanding of consistent branding, or that the HBO brand generally represented quality in a sea of homogenous crap.
All told, this series of pointless mergers only really illustrates the media industry’s mindless “growth for growth’s sake” mindset, in which multi-billion-dollar deals are made for no other reason than to reduce taxes, boost executive compensation, and delude wealthy media executives into believing they’re savvy deal makers. All while employees and customers alike get the very short end of the stick, and the end product winds up being decidedly worse than when these purportedly savvy dealmakers started.