That is the very short version of ATT’s view of the world. Which explains why two of AT&T’s top TV executives — most notably, HBO CEO Richard Plepler — are leaving their jobs, and why the head of AT&T’s movie studio is staying.
Those moves were announced Thursday night, February 28, two days after a federal court re-blessed AT&T’s $85 billion purchase of Time Warner. They are the most tangible effect of the phone company’s acquisition of one of the world’s most powerful media companies. And they say a lot about the way the phone guys see the media business.
For the record: David Levy, who ran Turner — TNT, TBS, Cartoon Network, and other TV networks owned by the company that’s now called WarnerMedia — is leaving. So is Plepler, who worked at HBO for 27 years and gets credited with making the pay TV channel the poster child for TV’s Golden Age. If you like The Sopranos or Game of Thrones or Sex and the City, he can claim at least partial credit for bringing them to you.
Big-deal WarnerMedia execs who aren’t leaving: CNN boss Jeff Zucker and Kevin Tsujihara, who runs Warner Bros, the Hollywood studio behind Aquaman. Coming aboard soon: former NBC exec Bob Greenblatt, who is expected to combine Turner and HBO and run them together.
Media insiders assumed AT&T would use this week’s court decision as the starting date to start re-orging Turner. So Levy’s departure isn’t shocking.
Plepler is different.
HBO was Time Warner’s most valuable property. Not in terms of revenue and profit, but because it was a singular TV brand consumers were willing to pay for. This is a time when everyone — the TV guys, the digital guys, phone guys — wants a singular TV brand they can use as the core for a new video business they will sell directly to consumers.
That is: When Apple talked to Time Warner a couple of years ago about a potential deal (which never went far), HBO was the thing they really wanted. And throughout the media industry, Plepler — tanned and gregarious — was inseparable from HBO.
Which means he should have been inseparable from AT&T, which plans on using HBO as the — wait for it — singular TV brand that will be the core of a new video business it will sell directly to consumers.
It was reasonable to assume that Plepler, an archetype New York/LA TV guy who vacations in Italy and wears loafers without socks, might eventually clash with the phone guys from Dallas.
And there had been signs of discomfort for many months: Last summer, reports of an awkward town hall meeting between Plepler and John Stankey, the AT&T exec overseeing WarnerMedia, circulated. More recently, when I called an HBO source to get their perspective on AT&T’s plans for WarnerMedia, that person described the plans as “inchoate,” an adjective that has rattled in my head ever since. If they’re willing to say that to a reporter, imagine how they really feel.
But it was also reasonable to assume AT&T — which explained over and over that it wanted the media executives it had just acquired to run the media the company it had just acquired — would go a long way to keep Plepler around for a while. Otherwise the message to Wall Street would be: Yes, we bought a media company for $85 billion and yes, we have no media experience, but no, we don’t need the guys who built it anymore.
Which now appears to be the message, after all.
Don’t take it from me. Here’s a WarnerMedia insider, describing how the new bosses think about their media company:
“It’s a plug-and-play mindset — that you can put the best athlete in any position and they can win. That hasn’t been historically the case in media.” (Then again, Reed Hastings and Ted Sarandos had zero Hollywood experience, and now the Netflix executives have totally upended Hollywood.)
Back to the future, and why Plepler won’t be a part of HBO’s: AT&T, which used to praise the fact that HBO and Turner and Warner Bros. were all separate businesses, has now made it clear that it doesn’t think of Turner and HBO as separate businesses, after all.
It’s going to run them together under Greenblatt and ultimately it wants to sell them together to consumers: You’ll get your HBO, and maybe your CNN and TNT (if you like NBA basketball), and you’ll pay AT&T directly for it. Just like Netflix or Spotify or the Disney service launching later this year.
Reporting up to Greenblatt alone could have been a reason for Plepler to leave. But the bigger issue, according to insiders, was the idea that HBO wasn’t going to be a standalone unit with its own goals and ambitions.
For example: In an AT&T world, it would make perfect sense for early seasons of Game of Thrones to be running right now on TNT or TBS, to stoke interest — and subscriptions — for the series finale airing on HBO in April. In Plepler’s not-for-very-much-longer version of HBO, that’s a nonstarter: You watch HBO shows on HBO, because you paid for HBO.
And if all of that sounds like small stuff to you, you haven’t run an incredibly valuable, critically lauded and commercially successful pay TV empire on your own for many years. Merging it with a bunch of other … stuff and packaging it all to consumers may make sense. But it doesn’t mean you have to like it, or stick around for it.
Finally, note what’s not changing right now: Tsujihara, who has run Warner Bros. for several years, will continue to do so — and, crucially, it appears that AT&T has much less interest in changing the way that business operates. It will make movies and TV shows, and sell them to consumers (or other TV networks).
You may not have loved Aquaman, but other people did, and that makes AT&T happy. “Thing just did a billion dollars at the box office,” as AT&T CEO Randall Stephenson noted to me earlier this month. If Tsujihara can keep producing results like that, he’s staying. That wheel isn’t being reinvented yet.
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