Sales 2023: $ 41.321 billion (€ 38.214 billion)

Overview

With the mega-merger in 2018, WarnerMedia, the world's largest media group from the late 1990s to 2010, became part of the world's largest telecom group, AT&T. Just three years later, the merger was canceled. In 2022, WarnerMedia merged with Discovery, previously ranked 23rd in our ranking. Since then, blockbuster media deal (New York Times) the new company is called Warner Bros. Discovery.

General Information

Headquarters
Warner Bros. Discovery
230 Park Avenue South
New York, NY 10003
USA
Telephone: 001 212 548 5555
website: ir.wbd.com

Branches of trade: Free TV, Pay TV, Streaming, Film and TV Production, Film Distribution, Advertising
Legal form: Stock Company
Financial year: 01.01 – 31.12
Founding year: 1923 (Warner Brothers Pictures), 1985 (Discovery Channel)), 2022 (Warner Bros. Discovery)

Basic economic data (in US$ billion)

	2023	2022	2021	2020	2019	2018
Revenue Warner Bros. Discovery	41,32	33,82
Profit (Loss) Warner Bros. Discovery	(3,13)	(7,37)
Total revenue AT&T			168,86	171,76	181,19	170,76
WarnerMedia revenue			35,63	30,44	35,26	20,59
AT&T profit (loss)			21,48	(3,82)	14,98	19,37
Stock price (year end, in $US)	11,20	9,48	18,58	21,72	29,50	22,92
Employees (AT&T)	35.300	37.500	203.000	230.000	247.800	268.220

Executives and Directors

Management:

• David M. Zaslav, President and CEO, and Director
• Gunnar Wiedenfels, Chief Financial Officer
• Bruce Campbell, Chief Revenue and Strategy Officer
• Dave Duvall, Chief Information Officer
• Lori Locke, chief accounting officer
• JB Perrete, President & CEO, Global Streaming and Games
• Jennifer Remling, Chief People & Culture Officer
• Asif Sadiq, Chief Global Diversity, Equity and Inclusion Officer
• Avi Saxena, Chief Technology Officer
• Savalle Sims, Chief Legal Officer
• Jon Steinlauf, Chief US Advertising Sales Officer
• Gerhard Zeiler, President, International

Supervisory Board:

• Samuel A. Di Piazza, Jr.
• David M. Zaslav, Discovery Inc.
• Li Haslett Chen
• Richard W. Fisher
• Paul A. Gould, Allen & Company, LLC
• Debra L. Lee
• Kenneth W. Lowe, former Chairman Scripps Networks Interactive 
• John C. Malone, Liberty Media Corporation
• Fazal Merchant
• Paula A. Price
• Daniel E. Sanchez
• Geoffrey Y. Yang

History

The film company Warner Brothers can look back on a turbulent history. The studio was founded in 1923 in Hollywood, a remote suburb of Los Angeles where there wasn't much to see except sunshine. As the sons of Jewish immigrants from what was known as Congress Poland, the brothers Harry, Albert, Jack, and Sam Warner were fascinated by the magic of the world of film, back then still in black and white and without sound. They rented simple business premises on Sunset Boulevard to produce their first films. In 1927, they achieved their breakthrough with "The Jazz Singer," the first talkie in history. Jack Warner, however, had his doubts. Quote: "Who wants to see movies with talking people?" The Warner brothers produced "The Jazz Singer" and were never to regret it. With the profits, they were able to buy a property in Burbank, north of Hollywood, and operate a regular film studio there. The site can still be seen in the opening credits of every Warner film.

Unlike Metro-Goldwyn-Mayer, Warner concentrated not on glamorous epic films, but on less risky productions (gangster films, romantic dramas). While they generated fewer headlines, they achieved good sales, with films such as "Casablanca" (1942), "East of Eden" (1955), "Rebel Without a Cause" (1955), "My Fair Lady" (1964), "A Clockwork Orange" (1971), "The Exorcist" (1973), "The Shining" (1980), "Blade Runner" (1982), and "Heat" (1995). Then, in the 1950s and 1960s, Warner expanded its business to include TV and record production.

For the sake of completeness, here's an overview of the other major Hollywood studios (besides Warner Brothers): Universal Pictures (founded in 1912, now part of Comcast, ranked third in the current IfM ranking), Paramount Pictures (founded in 1912, now part of Paramount Global, ranked 14th in the IfM ranking), Walt Disney Pictures (founded in 1923, ranked fifth), and Columbia Pictures (founded in 1924, now part of Sony, ranked tenth). 20th Century Fox, however, founded in 1935 and the sixth major for decades, no longer exists since it was acquired by Disney in 2020.

Continuing with Warner: In 1969, Steven Ross, CEO of Kinney National Service, bought Warner Brothers for US$400 million. Jack, the last remaining of the four Warner brothers, retired due to age. He had already thrown the other three out of the family business in the late 1950s using unsubtle tricks. Warner Brothers was then renamed Warner Communications, and Ross ushered in a new era. In "The Master Switch" (author: Tim Wu), for example, Steven Ross is described as "the first example of the new archetype of a great media mogul," a role model for dazzling figures such as later Michael Eisner (Disney) and Barry Diller (Paramount). Under Ross, the first media conglomerate in the 1980s included, in addition to the film studio, the comic book publisher DC Comics, the Mad Magazine, the video game developer Atari and the Cosmos New York soccer team.

Time Inc. was founded in 1922, a year earlier than Warner. Henry Luce and Briton Hadden, school friends and later fellow students at Yale, had been toying with the idea of a weekly news magazine for some time. A revolutionary idea at the time. On March 3, 1923, the first issue of Time at the kiosks – with enormous success. Other magazines followed: the Foto-Illustrierte Life, the business magazine Fortune, the gossip magazine PeopleAfter World War II, Time Inc. was not only the largest magazine publisher in the United States, but also in the world. A passionate (rather than sober) writing style was its journalistic concept.

In 1989, Warner and Time Warner merged. From then on, the name TimeWarner stood for the world's largest media conglomerate. The idea of an "integrated media conglomerate" would subsequently inspire many groups in the media sector. For TimeWarner CEO Gerald Levin, this wasn't enough. In 1996, he bought the CNN group from its founder Ted Turner for US$1,400 million. Turner had launched the first 24-hour news channel in Atlanta in 1979. Initially derided as the "Chicken Noodle Network" because of the constant slip-ups of its young correspondents, Turner's "Cable News Network" soon blossomed into a global quality news brand, with which first Turner and then TimeWarner made significant profits.

Levin wanted even more. On January 10, 2000, he announced the merger of TimeWarner with the Internet giant AOL. The two companies were the world's largest players in both traditional and digital media. Almost intoxicated by the internet fever on the stock market, the merger was hailed as a milestone for the final transformation of Old into a New Economy celebrated worldwide. The fact that, under the company's terms, AOL shareholders would hold 55 percent of "AOL TimeWarner," even though TimeWarner, with revenues of $27.3 billion, was nine times larger than AOL (revenues: $3.1 billion) and also generated more than twice as much net profit ($1.95 billion compared to $762 million), seemed justified at the time. Based on market valuation, AOL owners would have been entitled to 70 percent.  

But soon the internet bubble burst, and with it the euphoria. AOL TimeWarner plunged into a deep crisis. Levin resigned as CEO in June 2002, and AOL founder Steve Case was forced to resign from his position as chairman a year later. Richard "Dick" Parsons, who rediscovered the values of the old media world, emerged as a powerful new figure in the company. He succeeded in putting the struggling company on a growth path. In the fall of 2003, he dropped "AOL" from the company name; TimeWarner was once again TimeWarner. And at the end of 2009, the AOL internet division was completely divested.

TimeWarner also withdrew from the music, book, and cable businesses. Warner Music Group (WMG), one of the world's four major record companies, was sold in February 2004 to an investor group led by Edgar Bronfman Jr. (now part of Access Industries, ranked 32nd in the IfM ranking). In 2006, TimeWarner Book Group was sold to the French Lagardère Group (part of Vivendi since 2023, ranked 20th in the IfM ranking). TimeWarner Cable was spun off in 2009. A further restructuring took place in 2013: The magazine division Time Inc., which had been running at a loss after years of mismanagement, was transformed into an independent company. WarnerMedia now essentially consisted of one of the major Hollywood studios, CNN, and the pay-TV channel HBO (which played a key role in reinventing the series genre in the 1990s).

In June 2018, Warner was taken over by AT&T, the largest US telecom company. This mega-merger, a “threat to American democracy” (Guardian), AT&T took first place by far in our ranking of international media companies. AT&T: a big name. In 1885, the original American Telephone and Telegraph Company founded by none other than Alexander Graham Bell (1847-1922), the inventor of the telephone. It wasn't long before AT&T ("Ma Bell") was able to establish a US and Canada-wide monopoly with the help of the so-called "Bell System" of telephone companies. Until 1984: After a ten-year antitrust case, the AT&T monopoly was broken up and divided into seven regional telephone companies ("Baby Bells"). In 2006, however, AT&T was able to revive the company it had split off more than 20 years earlier. Bell South and became the world's largest telecom company again. In 2015, AT&T then moved into traditional media, acquiring the leading US satellite TV provider DirecTV. The company now called itself "the premier integrated communications company in the world," as the largest pay-TV provider worldwide.

DirecTV's history: It was the famous aviation pioneer and film producer Howard Hughes who developed satellite technology starting in the mid-1950s, initially as part of his aerospace company, Hughes Aircraft. After his death in 1976, Hughes Aircraft was sold to General Motors. Under GM's control, the satellites launched into space by Hughes Electronics in 1994 Direct Broadcast Satellites Already in 2003, they were making a profit and soon had twelve million customers who paid over US$50 per month for around 150 TV channels.

In 2004, Hughes Electronics sold its remaining business units and became the DirecTV Group. By 2007, around 25 percent of all households had a DBS connection. And in 2014, AT&T announced it would acquire DirecTV for $1,049 billion. The FCC approved the deal in 2015, and AT&T Entertainment (the new name) became the largest pay-TV provider in the US with 26 million customers. A year later, the next coup came: In October 2016, AT&T and TimeWarner, then the world's sixth-largest media company, agreed to a merger; in June 2018, the deal was approved by antitrust authorities.

Just three years later, however, it was over. AT&T announced that it would spin off WarnerMedia and merge with Discovery, Inc. Discovery, previously ranked 23rd in our rankings. Following the EU 2021, US authorities gave the green light to the merger of WarnerMedia and Discovery (now called Warner Bros. Discovery) in February 2022. AT&T shareholders received 71 percent of the shares, while Discovery shareholders received 29 percent. In retrospect, the Warner spinoff was a fiasco for AT&T: AT&T had bought TimeWarner for US$102 billion, only to sell HBO, Warner Bros., and the struggling CNN for less than half (US$43 billion). 

About the history of Discovery: When on June 17, 1985, the Discovery Channel on air When it came to the issue, there were quite a few TV insiders who doubted the long-term survival of the documentary channel with its sophisticated programming (covering topics such as continental drift, icebergs in Newfoundland, and a portrait of the ancient Egyptian pharaoh Akhenaten). Experts estimated that advertising-relevant target audiences were too uninterested in such films, and the quality of the US TV landscape was simply too shallow.

But John Hendricks, Discovery's first CEO, suspected that there was a target audience among viewers that had not been adequately addressed by the advertising industry: the so-called LLL ("lifelong learners"). Hendricks calculated that these audiences would remain curious well into old age and desire programs that would entertain and educate them. What had already worked in the US magazine market in the form of National Geographic or Scientific American – appealing to an audience interested in science and culture – should now also work on television. The people in charge of the Discovery Channel knew that their programming would not reach a mass audience. Instead, they concentrated on educated and well-earning Americans who were of interest to advertisers whose products fit Discovery's programming: technology, science, travel. Of course, the Discovery Channel was a television experiment. No one could predict how the audience would react to Discovery's infotainment focus.

One of the reasons for the channel's establishment was its distribution as a cable channel. Discovery, with its niche programming, was a natural fit for US cable television. Unlike traditional cable channels, Discovery did not charge media companies for its distribution. And cable providers hoped to boost their image by adding Discovery (a channel that sees itself as a high-quality information channel).

In its first 20 years, the Discovery Channel was transformed into the global media group of the same name. Numerous specialty channels were acquired or founded, including The Learning Channel (1992), Animal Planet, Discovery Science, Discovery Kids, Discovery Civilization, Discovery Home and Leisure, Discovery Wings (all 1996), Travel Channel (1997), Discovery Health Channel (1999), Fit TV (2003), and Discovery Lifestyle Networks (2004). International expansion was also pursued. Discovery first broadcast in Great Britain in 1989; it expanded into the Latin American and Asian markets in 1994, and Scandinavia and Central and Eastern Europe in 1997. Overall, Discovery's audience grew from 156,000 US Americans in 1985 to 187 million people from 146 countries in 2000.

Between 2001 and 2005, a crisis hit, with US ratings falling by 30 percent. The network's affiliate channels also failed to maintain their position in the top 20 cable channels. There were several reasons for this decline. First, the television landscape had changed. More and more niche channels and documentary formats were competing for viewers. The National Geographic Channel, launched in 1997, in particular, challenged Discovery for market share. Furthermore, a general improvement in the quality of series formats had been noticeable since the late 1990s at the latest.

Discovery's programming itself was also part of the problem. Formats with a history or science focus were increasingly replaced by shallower lifestyle programs that differed only marginally from their counterparts on the major networks. David Zaslav (CEO of Discovery since 2006, now CEO of Warner Bros. Discovery) recognized this. Zaslav diversified the programming and focused on Discovery's key target audience of 28- to 42-year-olds. Topics such as family, parenting, and wealth management were increasingly addressed (the best example is the channel's top-rated show, "Cake Boss," about an Italian-American family of cake-baking entrepreneurs in New Jersey).

management

Randall Stephenson will likely go down in history as the AT&T CEO who nearly ruined the giant telecom company. John Stankey, Stephenson's right-hand man, his successor, and the current CEO of AT&T, will then go down as the man who saved the company. Stankey (born 1962) reversed the $102 billion merger that simply didn't work: the merger of AT&T and WarnerMedia. The merger of the wireless giant with the entertainment business. In the second quarter of 2022, WarnerMedia was spun off from AT&T. The press commented: "John Stankey seemed like someone who had an enormous weight lifted off his shoulders."

Then came the merger of WarnerMedia and Discovery (ranked 23rd in the IfM ranking). However, the company, called Warner Bros. Discovery, will not be led by WarnerMedia CEO Jason Kilar. Kilar, born in 1971, was the founding CEO of Hulu (video-on-demand), and in 2022, with a salary including bonuses of $52 million, will be the highest-paid media executive. Instead, it will be led by Discovery CEO David Zaslav, born in 1960. Even though Discovery was the smaller partner in the 2022 merger. Regarding Zaslav, Bloomberg headlined: "The King of Trash TV Receives the Keys to the HBO Kingdom." Zaslav simply commented in a press conference: "We believe this merger makes us the best media company in the world."

Business Units

Warner Bros. Discovery divides its business into three segments (film, television, and streaming). Available in over 220 countries and 50 languages.

“Studios Segment”Production and distribution of cinema/TV films and series with partners such as the Warner Bros. Motion Picture Group (Warner Bros. Pictures, New Line Cinema, Warner Bros. Pictures Animation), the Warner Bros. Television Group, DC Studios, and many more. Warner Bros. is one of the "big five" Hollywood film studios (Disney, Warner Bros., Universal, Sony Pictures, Paramount), which first dominated the American and then the global film industry. Warner Bros. has access to a 200,000-hour program library.

“Networks Segment”: US entertainment channels (TNT, TBS, Turner Classic Movies, OWN, Discovery Channel, Cartoon Network, Adult Swim, truTV); lifestyle channels (e.g. Magnolia Network, HGTV, Food Network, Travel Channel, Science Channel, TLC); plus the international news channel CNN and the global sports networks of TNT Sports (including Eurosport), and much more.

“Direct-to-consumer segment”: This segment (97.7 million subscribers at the end of 2023) includes streaming services such as Max, HBO Max, and Discovery Plus, as well as HBO's premium pay-TV. Founded in 1972, HBO is the oldest pay-TV channel in the USA and also operates numerous of its own specialty channels. Examples of global HBO series successes include "Sex and the City" (1998), "The Sopranos" (1999), "The Wire" (2002), and "Game of Thrones" (2011). In May 2020, the company's own streaming service, HBO Max, was launched as a response to Netflix and Amazon Prime Video. In summer 2021, HBO and HBO Max had a combined total of 73 million subscribers worldwide. Warner currently operates two separate streaming services, HBO Max and Discovery Plus, although HBO Max is significantly more widely used. The games division, Warner Bros. Interactive Entertainment, includes numerous development studios.

Current developments

In December 2023, there was worldwide speculation about a merger between Warner Bros. Discovery and Paramount, and reports of an hours-long meeting between Warner CEO David Zaslav and Paramount CEO Bob Bakish were reported. The primary focus was said to be to create more competition for streaming giants Netflix and Disney+ through a merger. However, in early November 2024, Bloomberg reported that Paramount+ was abandoning the idea despite months of planning. They had received "no concrete offer."