AT&T is considering major structural changes to the Turner division of WarnerMedia now that the last legal threat to the telco giant’s acquisition of Time Warner has been removed.
On Tuesday, a federal appeals court rejected the Justice Department’s appeal of the decision last June that allowed AT&T to proceed with its $85.4 billion purchase of the parent company of HBO, Warner Bros. and Turner. Last year, AT&T committed to managing Turner as a separate entity underneath the WarnerMedia umbrella on the chance that it would be forced to sell off the division that is home to TNT, TBS, CNN, Cartoon Network, Adult Swim, TCM and TruTV.
Now, Turner staffers in Atlanta, New York and Los Angeles are preparing for changes to come. It’s understood that AT&T chief Randall Stephenson and WarnerMedia CEO John Stankey have questioned why Turner’s operations were kept so distinct from HBO and Warner Bros. in the Time Warner era. (Time Warner acquired the former Turner Broadcasting System from its namesake founder Ted Turner in 1996).
It’s believed that AT&T is looking for ways to cut down on the level of duplication, particularly in administrative functions. Turner’s cable networks could be streamlined in some fashion with HBO’s operations, while other content- and consumer products assets could be put under the Warner Bros. umbrella. AT&T is on the hook to find $2.5 billion in synergy savings over the first three years after the acquisition. Eliminating much of the Turner infrastructure would help that cause.
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Former NBC Entertainment chairman Bob Greenblatt has emerged as a wildcard in a possible shakeup of the status quo at WarnerMedia. As first reported by the Hollywood Reporter, Stankey has reached out to Greenblatt to discuss the possibility of him joining the company in a senior management role. The specifics of what that would be — and whether it would involve Greenblatt overseeing Turner cable assets — are still unclear.
The prospect of big changes coming to Turner was signaled in January when WarnerMedia tapped TNT/TBS chief Kevin Reilly to oversee original content for the streaming platform that the company plans to launch by year’s end. Reilly so far is maintaining his role as president of TNT/TBS, but the emphasis on building up the streaming service is clear. Reilly earlier this month tapped his top TNT lieutenant, Sarah Aubrey, to join him on the streaming side. TBS’ top programming executive, Brett Weitz, was promoted to general manager of TBS and TNT.
Turner president David Levy has also been in a state of limbo regarding his long-term future with WarnerMedia as the appeals process played out. There’s speculation about him shifting to a tighter focus into the sports arena for WarnerMedia and AT&T, given his background in handling Turner’s dealings with the NBA, NCAA and Major League Baseball over the years.
There’s speculation that TBS and TNT could become even more sports-focused than they are at present, and that those widely distributed general entertainment channels could be programmed in concert with the streaming service, as a second-window home for premium shows that debut on the still-unnamed service. There is also speculation within WarnerMedia that the TruTV channel may be phased out as a linear offering but remain a source of low-cost reality programming for other WarnerMedia platforms.
Reps for WarnerMedia and Turner declined to comment. Greenblatt did not respond to a request for comment.
(Michael Schneider contributed to this report.)