Many AT&T Internet and wireless customers will get HBO Max for free

Many AT&T Internet and wireless customers will get HBO Max for free

In its earnings report and investor call this morning, AT&T executives underscored that HBO Max, along with expanded 5G capabilities and connectivity services, are the anticipated bright spots for a company facing revenue drops nearly across the board.

Max, WarnerMedia's new streaming service created to take on players like Netflix, Amazon Prime Video and Disney Plus, is set to debut on May 27 although it is yet to disclose countries where the service will be available first. The HBO Max Marketing Team will build on HBO's legacy of innovative campaigns, applying the same level of excellence and storytelling to show how HBO Max is not just more than HBO, but more than HBO. While Covid-19 only began significantly affecting business in the second half of March, it had a $400 million revenue impact on the company. Given the economic uncertainty, the group withdrew its guidance for the year. Another major hit to revenue was the loss of the National Basketball Association playoffs, long a mainstay of TNT.

The coronavirus impact was strongest at WarnerMedia, which lost around Dollars 1 billion in revenue year-on-year and over USD 500 million in adjusted EBITDA. Stankey said the company is "right on the plan" with AT&T TV in terms of expected volume.

The crisis is prompting a "rethinking" of the company's theatrical model, Stankey said.

Craig Moffett, an analyst at MoffettNathanson, warned that the first quarter was only a glimpse of the pain yet to come.

HBO subscribers were up a tick, 0.3% in the quarter, and Turner subscription revenues were up 4.3%. AT&T shares have fallen 24% since the beginning of the year, while the Standard & Poor's 500 index has fallen 15%.

Overall, advertising revenues across AT&T were down 12.9%. Even though it looked like AT&T had stopped the rate of haemorrhaging of video customers, Q1 2020 losses were less than those in the fourth quarter of 2019, a year ago video losses totalled 627,000.

For its Entertainment Group, AT&T said that it has seen solid video and broadband ARPU gains 209,000 AT&T Fibre net additions and IP broadband revenue growth of almost 2%. It shed 73,000 home-internet customers. The company also saw a hit to revenues from wireless services, partially due to a near-standstill in worldwide roaming revenues from traveling customers.

It's likely that quarterly earnings from other major media companies will be similar.

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