WarnerMedia CEO John Stankey Says DirecTV Not For Sale, Parries Succession Report

Dade Hayes

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John Stankey, who is in his final days as WarnerMedia CEO before moving up to the No. 2 position at AT&T, where he will continue to look after the film and TV portfolio, says DirecTV is not for sale.

The executive addressed the satellite business and other hot topics in an interview with the Wall Street Journal. Intriguingly, he also appeared to knock down a report earlier Tuesday by NBC News. Citing numerous unidentified sources, NBC affirmed that CNN and Turner boss Jeff Zucker is first in line to succeed Stankey as CEO of WarnerMedia when the latter moves up to become COO of AT&T.

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Sources familiar with the refinements to the company’s executive structure tell Deadline a proper CEO search, involving outside candidates, is a more likely course of action.

“I’m not looking to find my successor right at the moment,” Stankey told the WSJ with a dose of his customary directness. The paper added that he “has no plans” to surrender the CEO role after he moves up to his newly created AT&T post on October 1, meaning Zucker could be first in line, but the line may not budge. A WarnerMedia rep said the company does not comment on personnel matters.

The strategic moves at AT&T are under increasing scrutiny, in part due to activist hedge fund Elliott Management, which took a $3.2 billion position in the company and outlined changes it wants to see. The fund issued some blistering criticism of the DirecTV and Time Warner acquisitions in a letter to the AT&T board.

As to DirecTV, speculation has swirled in recent days about the way forward for the satellite distributor, given its hefty subscriber losses and devaluation since AT&T acquired it in 2015 for $67.1 billion including debt. One scenario pondered by Dish Network chairman Charlie Ergen at last week’s Goldman Sachs conference in New York was a combination of Dish and DirecTV, but he acknowledged that regulatory alarms could be tripped. AT&T CFO John Stephens also said a merger of the two satellite giants “has been tried” but has never seemed likely to clear regulatory hurdles.

Stankey said various options for DirecTV were considered, but the decision to retain it came down to its value as a vehicle for targeted advertising. In markets where DirecTV households can also get advanced broadband service from AT&T, Stankey said, satellite churn has been lower. The broadband offering is a key weapon for AT&T as it looks to compete with major pay-TV operators like Comcast.

Pricing for HBO Max will be revealed October 29. Stankey told the WSJ the service’s “higher quality should warrant a slightly higher price.” Apple and Disney have recently established the low end of the streaming spectrum, at $5 and $7 a month, respectively. HBO Now currently runs $15 a month.

Stankey also defended the wholesale restructuring of WarnerMedia, which has brought massive changes to the decades-old company that had grown accustomed to business units operating in silos. As to the large number of departures of senior executives, notably HBO chief Richard Plepler and Turner head David Levy, Stankey said, “We got to the restructuring of this business through the input of the people who ultimately wanted to play.”

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