AT&T, the telecommunications giant that deals with media and entertainment, announced a change of guard on Friday.
John Stankey, a veteran of the company, will become the new CEO on July 1st. He will take over from Randall L. Stephenson, who has headed AT&T since 2007.
The 57-year-old Stankey was appointed Chief Operating Officer last October and has managed most of the company’s business since then. Previously, he led AT&T’s entry into the media and entertainment industry Acquired $ 85.4 billion Time Warner, home to CNN, HBO and Warner Bros. film studio in 2018.
The 60-year-old Stephenson will continue to be CEO this year, the company said in a statement.
“I’ve worked closely with John for over 20 years,” said Stephenson in a video directed at the company’s 244,000 employees on Friday. “I asked him to take on some of our biggest challenges every time it was delivered.”
Mr. Stankey called it a “privilege” to work at AT&T. In a separate statement, he added, “I can honestly say that I didn’t see this on the cards almost 35 years ago when I entered the company to handle customer requests for phone service.”
California-born Stankey started his career at Pacific Bell in 1985. He has spent much of his time in Texas and worked at AT&T former headquarters in San Antonio until the company moved its headquarters to Dallas in 2008. A self-described “Bell headHe is known for his deep voice, his dull nature and his tendency to speak in jargon. He once headed AT & T’s landline operations and oversaw DirecTV, the satellite television service that the phone giant acquired in 2015.
This business has declined sharply as customers switched to cheaper online alternatives like Netflix. The migration of viewers to streaming led to AT&T taking over Time Warner and the development of HBO Max, the streaming service that is due to make its debut on May 27th.
As head of AT & T’s WarnerMedia division from the merger until recently, Mr. Stankey stepped out of the relatively anonymous role of telecommunications director into the media. He visited New York, Washington and Los Angeles when he brought the AT&T ethos to CNN, HBO, the Turner Cable Channels and Warner Bros.
In his 20 months at the helm of WarnerMedia, Mr. Stankey redesigned the department to focus on streaming and broadened the boundaries between the individual units of the conglomerate. The sociable, long-time HBO boss Richard Plepler left the company on his watch and signed a five-year contract to produce shows and films for Apple TV Plus.
Mr. Stankey has had his critics. Shortly after he was named head of the media business, Elliott Management, one of Wall Street’s largest and most aggressive hedge funds, bought a $ 3.2 billion stake in AT&T and sharply criticized his strategy. Elliott aimed directly at Mr. Stankey.
After being appointed Chief Operating Officer and President in October, the hedge fund disapproved that Mr. Stankey “now serves as President and C.O.O. would be responsible for additional revenue of $ 145 billion. of the entire company. “
The tone has shifted since then. Elliott withdrew after Mr. Stephenson approved some of his proposals, and on Friday the hedge fund announced its support for Mr. Stankey’s appointment as chief executive.
“We look forward to working with John at the beginning of his tenure as C.E.O.,” said Jesse Cohn, the Elliott partner who led the investment in AT&T.
The timing of Mr. Stankey’s appointment was a surprise. In October Mr. Stephenson outlined a three-year plan The goal was to increase the company’s revenue, including remaining as CEO until 2020, rather than retiring earlier as planned. At the same time, the company was looking for a new managing director as well as someone to replace Mr. Stankey as head of WarnerMedia. AT&T chose the WarnerMedia job Jason Kilar, the former boss of Hulu. He will take over this part of the company in May.
The board completed its search for a new AT&T managing director much earlier than planned this month and decided to immediately announce Mr. Stankey as the new manager. The company said Mr. Stephenson said he would stay in the job for a year to give the board time to perform his search.
President Trump, who has repeatedly attacked CNN for reporting, called Stephenson’s departure “Great news!” on twitter. In the early years of his presidency, when he scolded the news network on social media and rallies, the Justice Department unsuccessfully sued to block the AT&T merger with Time Warner. AT&T declined to comment on Mr. Trump’s comments.
For most of his career, Mr. Stankey was little known outside of the telecommunications field, but quickly attracted attention after AT & T’s blockbuster takeover of Time Warner. He learned how intensively the media industry was questioned when the video of a sometimes uncomfortable and tense town hall meeting was recorded by HBO employees with Mr. Stankey and Mr. Plepler leaked to the New York Times.
After the first sensation, Mr. Stankey went behind the scenes and piece by piece installed his own management team.
He inherits an empire that includes telecommunications, media, technology, and sales. The company’s valuation exceeds $ 209 billion, but the key mobile business has slowed as price wars with competitors Verizon and T-Mobile dampened sales. T-Mobile became a strong challenger closed Sprint acquisition this month.
The battle for customers among the major mobile operators has driven subscription prices down. The average monthly mobile phone bill has dropped by over 25 percent over the past decade Bureau of Labor Statistics data. Mobile operators are still making high profits, but have flattened or declined in recent years.
AT&T, the second largest mobile operator in the country with 79 million customers, The coronavirus pandemic had suffered a blow in the first quarter. Revenue decreased $ 600 million and profit decreased $ 360 million, mainly due to the Loss of sports programming in his Turner division. However, the company has also recovered part of the license fees it has paid to N.C.A.A. After canceling the annual men’s basketball tournament, Turner saved $ 420 million in costs.
Mr. Stankey is also the heir to the plan that Mr. Stephenson drew up in October. It calls for a review of AT & T’s extensive businesses to determine which ones can be sold, including DirecTV, and an assurance that the debt associated with the acquisition of Time Warner will be paid.
HBO Max, the planned streaming service that will be the exclusive online home of HBO’s “Game of Thrones”, the Warner Bros. sitcom “Friends” and the Warner Bros. film series “Harry Potter”, is also critical to the success of the company. To prevent customers from switching to other mobile operators, AT&T plans to bundle HBO Max into its high-end plans and offer promotional discounts for its cheaper tiers.
Mr. Stephenson leaves with a random package. He has a $ 64 million pension and an additional deferred income of $ 27.6 million.
Mr. Stankey paid compensation of $ 17.8 million for 2019, but his employment contract as a manager is likely to be higher. The company has not yet announced its new compensation.