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  Time Warner, HBO, AT&T, DirecTV

Time Warner acquisition to drive domestic AT&T subscriptions to more than 200m by end 2017

Today, HBO launched subscription video-on-demand (SVoD) service, HBO Espana, in Spain, giving it an SVoD presence in more than 10 markets across the US, Latin America and Europe. If AT&T’s acquisition of HBO’s parent, Time Warner, closes, not only will it complement DirecTV’s Latin American offering, it will also give AT&T its first European foothold. Unlike the Nordic HBO Now, HBO Espana, which costs €7.99 per month, will also include a selection of TV Shows and movies from other studios including Disney and Nickelodeon on top of HBO content.

AT&T is also unveiling its linear TV streaming service, DirecTV Now, which, along with the acquisition of Time Warner - also a 10% stakeholder in US streaming service Hulu -  will give AT&T an extensive portfolio of subscription over-the-top (OTT) services. It will also help AT&T to surpass 200m subscriptions across its domestic subscription services by the end of 2017, making it the first US telecoms company to do so. Had Time Warner maintained ownership of TWC, which had around 30m subscribers when it was sold to Charter Communications in the first half of 2016, this milestone would be reached upon the closing of the deal. The extra assets, however, would make the deal subject to more regulatory scrutiny.

AT&T has 13% of its subscribers on triple or quadruple-play packages, so the new subscription OTT services could drive multi-play customers for AT&T even higher. According to our latest consumer data, 47% of AT&T customers have access to HBO services, which could lead to as much as 6% of AT&T subscribers becoming quadruple or quintuple-play subscribers.