The new powerhouse, which brings together the HBO Max and Discovery+ streaming platforms, has estimated combined revenue of $49.8 billion this year.
“Today’s announcement marks an exciting milestone not just for Warner Bros. Discovery but for our shareholders, our distributors, our advertisers, our creative partners and, most importantly, consumers globally,” said Zaslav, in a statement announcing the close. “With our collective assets and diversified business model, Warner Bros. Discovery offers the most differentiated and complete portfolio of content across film, television and streaming.
Wall Street observers have been bullish about the combination. The new sector powerhouse “will have substantial content production and distribution capabilities that can be utilized for a compelling direct-to-consumer offering targeting a variety of demos,” Barrington Research analyst Jim Goss wrote in a March 7 report.
In upgrading the stock of Discovery to “buy” in a January report entitled “Revving up the content engine,” Bank of America analyst Jessica Reif Ehrlich even argued: “As a combined entity, we believe Warner Bros. Discovery has the potential to be the most dynamic global media company.” Peter Csathy, chairman of advisory firm CreaTV Media, similarly touts the potential for the new content behemoth. “Netflix, Amazon Prime Video and Disney+ are the ‘big three’ streamers vying for our eyeballs,” Csathy says. “But WarnerMedia/HBO Max was a contender, even before its merger with Discovery. HBO Max, of course, features perhaps THE top ‘brand’ with HBO.”
For Discovery, its biggest merger ever also means a change of strategy, moving beyond its traditional focus on unscripted content, which Zaslav in the past described as an advantage.
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