$30,000 Millionaire said:
I think the question to ask is why would AT&T fare better with integrating Discovery than they did with Time Warner, DirecTV, and tons of other businesses that they've bought.
The SBC / AT&T and Bell South acquisitions made sense for access to their assets, Cingular in particular. I don't think they've exactly crushed it with the IusaCell assets in Mexico.
What should speak volumes is that when they acquire companies, the former CEOs and executives can't get out of the place fast enough.
It read to me that the integration is a separate company and AT&T will own 71% while Discovery owns 29%. I can't answer the question(s) on their integration success or failure, but if the current AT&T leadership team can't, or don't want to, make a go of Warner Media within the AT&T structure; then spinning it out is a better option to see if that business can be successful versus selling it. At least they're giving it a chance to survive on its own.
I am not taking up for AT&T leadership (especially per what you relayed to me) but a sound team would do the above if they aren't comfortable with business diversification.
Personal Opinion,...based on what you conveyed to me about T's leadership and my experience with similar leadership teams, current leadership knows the old business is a money making machine and want the old business to function as it always has so they keep their Exec roles, and no boat rocking. That leadership team doesn't want a Warner Media distraction to explain at the earnings call or to the rest of the employees. They deemed it necessary to distance themselves from Warner Media and the former AT&T CEO regime. Sounds like this leadership group wants back to basics, because they're smart enough to know that the old model works, regardless if growing shareholder value is achieved.
I'm interested to see who the new CEO will be for the Warner Media/Discovery company, could be a "yes man" for the current AT&T leadership group. However, if this CEO is motivated and a go-getter, that person just may embarrass the AT&T leadership for spinning it out and expose those who inhabit the C-Suite in AT&T. Political temperatures will be a measured daily. Either way, success or failure of the new company, the current leadership group has a message scripted for how it plays out. Leadership selling that message to the public, shareholder, and market, will be the deal maker or breaker.