AT&T’s big management mistake, according to former Time Warner CEO

No one likes to be micromanaged, and that includes Jeff Bewkes, former chairman and CEO of Time Warner, whose new book, “Tinderbox” presents his side of the story on the AT&T acquisition of Time Warner. It didn’t exactly work out the way it was planned — or, at least, not like Bewkes planned it. And the $85 billion transaction’s problem can be boiled down to a big management mistake Bewkes says AT&T made after the deal: thinking its management team needed to come into Time Warner and have a heavy hand in operations.

In an interview with Andrew Ross Sorkin on CNBC’s “Squawk Box” on Wednesday, Bewkes was clear on the fact that Time Warner needed a deal.

HBO was fine on its own, and as Bewkes said, it was nothing new for subscribers to be able to binge watch every episode of “The Sopranos” if they wanted to do so.

But what Time Warner lacked was a broader platform to distribute all of its television and film content, and figure out advertising and monetization of customer data in a changing media landscape.

“We needed to get addressability so you could watch your favorite shows on the networks that you are used to seeing them on.” 

Time Warner considered partnerships with big tech and media companies like Amazon, Disney and Apple to bring all the content together in a direct consumer model, “and we ended up with AT&T,” the former chairman said.

“We thought they would take their 125 million customer relationships and big consumer data platforms and help us advertise on CNN, TNT, and TBS,” Bewkes said. “But that didn’t happen.” 

At the time of the deal, Bewkes sounded more enthusiastic.

“This is a natural fit between two companies with great legacies of innovation that have shaped the modern media and communications landscape, and my senior management team and I are looking forward to working closely with Randall and our new colleagues as we begin to capture the tremendous opportunities this creates to make our content even more powerful, engaging and valuable for global audiences,” he said in the 2016 deal announcement.

But the October 2016 deal was not designed “for AT&T to manage the Time Warner networks better,” Bewkes said on CNBC. “Because [AT&T] didn’t have network studios we thought they would let our people guide the process. Instead, they replaced our management with theirs.” 

The $85 billion deal gave AT&T ownership over cable channels like HBO and CNN, and the Warner Brothers film studio. 

“I don’t think it turned out as well as the street and we had hoped,” Bewkes said.

AT&T disagrees, with a spokesman telling CNBC that “the data/facts don’t align with Jeff’s narrative.”

He cited the growth in HBO from a $6 billion subscription business that had plateaued to an $8 billion…