AT&T $150 billion merger with Discovery
Merger could hasten HBO’s African launch
AT&T, the parent company of HBO, is reportedly close to merging with Discovery for a deal of $159 billion. The deal unites Hollywood's two largest studios, Warner Bros. and Discovery, to form a new streaming behemoth. The new business, according to reports, would be distinct from AT&T (The telecoms arm).
The battle for the streaming market is intensifying, and AT&T's empire took a significant step forward in 2018 with the acquisition of Time Warner and HBO. However, by merging with Discovery, the company may be attempting to usurp Netflix's dominance.
Expansion is a significant component of that. HBO Max announced its intention to expand into Africa, the Middle East, and Europe in January.
Prior to expansion, the streaming service has chosen the region's leadership team. Christine Sulebakk has been appointed general manager of HBO Max for Europe, the Middle East, and Africa (EMEA).
HBO has not, however, announced or indicated the precise date on which the video streaming service will be available in Sub-Saharan Africa.
Sulebakk previously stated in a media statement that it could take a couple of years.
However, the merger could shorten the timeline and result in the service being launched sooner as a result of the new funding. Discovery's market value, including debt, is currently around $30 billion.
Africa’s streaming market
Africa's video streaming industry has grown at a breakneck pace. MultiChoice recently expanded its network in South Africa by adding two of HBO's competitors, Netflix SA and Amazon Prime Video. This results in increased subscriber numbers for streaming companies based outside the United States.
HBO and HBO Max have a combined global subscriber base of approximately 64 million. This is dwarfed at the moment by Netflix's more than 200 million subscribers and Disney+'s more than 100 million subscribers.
However, if Discovery's portfolio is leveraged, the streaming platform's numbers could grow significantly. Discovery is currently available in more than 88 million homes, and its streaming service, Discovery+, has a subscriber base of 15 million.
Another advantage of HBO Max's impending launch in Africa is that the service is not unfamiliar on the continent. Africans are avid viewers of its record-breaking series such as Game of Thrones, Watchmen, and Titans.
Although the majority of its films are currently viewed on secondary platforms, when it launches, its unique portfolio may help it attract a large number of subscribers, as Africans will welcome a platform where they can watch all of its series in one location.
Likewise, HBO Max, like Netflix, may increase its acquisition of local content to satisfy its subscribers when it launches.
It may result in the creation of additional jobs for African citizens within the company. For instance, when Netflix launched in Nigeria, it established Netflix Naija and Netflix SA Twitter accounts so that HBO Max could follow suit.
Finally, if the merger is completed, another major player will enter the streaming market. The combination of the filmmaking prowess of Warner Bros. Entertainment, home of the Harry Potter and Batman franchises, and Discovery's stable of cooking, nature, and science shows is one to watch.
However, a significant side effect of the deal may be a hasty expansion into new markets such as the Middle East and Africa.
