AT&T CEO says he would have canceled Roseanne too

Randall Stephenson, whose company is trying to buy Time Warner, was quick to say ABC did the right thing in response to a racist tweet by the show's star.

Marguerite Reardon Former senior reporter
Marguerite Reardon started as a CNET News reporter in 2004, covering cellphone services, broadband, citywide Wi-Fi, the Net neutrality debate and the consolidation of the phone companies.
Richard Nieva Former senior reporter
Richard Nieva was a senior reporter for CNET News, focusing on Google and Yahoo. He previously worked for PandoDaily and Fortune Magazine, and his writing has appeared in The New York Times, on CNNMoney.com and on CJR.org.
Marguerite Reardon
Richard Nieva
3 min read
AT&T CEO Randall Stephenson

Randall Stephenson, CEO of AT&T, speaks at the Boston College Chief Executives Club in February.

Boston Globe

AT&T CEO Randall Stephenson praised the cancellation of the popular ABC sitcom Roseanne after its star posted a racist-filled Twitter rant on Tuesday.

Stephenson was asked about the controversy Wednesday during an interview at Recode's Code Conference. AT&T is in the midst of trying to buy Time Warner, one of the biggest media companies, which owns cable channels such as HBO and Turner Broadcasting. Stephenson said he thinks ABC parent company Disney did the right thing in severing ties with Roseanne Barr.

When asked whether he would've fired her, he quickly answered, "I can't imagine how you would not."

The question comes as AT&T and Time Warner await the outcome of a lawsuit filed by the Justice Department to block a merger between the two companies that would bring together one of the largest telecom providers in the country with one of the highest-profile media companies. Stephenson and Time Warner CEO Jeff Bewkes say the deal is necessary to ensure the companies can compete against big tech giants like Google and Netflix. They argue concerns about the deal hurting competition are unfounded.

Stephenson reiterated these points during his interview at the Code Conference, stating that so-called vertical mergers that marry large-scale distribution and vast amounts of content are the only way to compete against companies like Facebook, Amazon, Netflix and Google -- which he abbreviates as FANG -- as customers cut the cord to subscription TV services.

"The model has to change," he said. Otherwise, he said, "you're going to have a hard time competing with these guys." He said that since the merger with Time Warner was announced in November 2016, the market caps of these companies has gone up $1 trillion dollars.

"You better figure out how to vertically compete here," he said.

Stephenson also acknowledged that the cord-cutting that makes this merger a necessity sped up in 2017, particularly among millennials. This caught the company off guard, even though growth in the market is away from paid TV subscription services, like AT&T's satellite TV offering from DirecTV and toward internet streaming service. Stephenson said the company has seen big growth in its DirecTV Now product, which distributes TV content directly over the company's nationwide wireless network. The company isn't yet making money on this service, but he believes revenue will grow over the next few years as it adds subscribers.

Stephenson also weighed in for the first time in public on Sprint and T-Mobile's $26 billion proposed merger announced last month. He declined to say whether he thought the deal was a good idea, but said it's likely "a tough hill to climb" to win regulatory approval. Still, he said the market has changed since his company attempted to buy T-Mobile in 2011.

"It will probably get a different review than our deal," he said. "Power to them if they get it done."

When asked about AT&T's payments to President Donald Trump's former lawyer Michael Cohen, Stephenson again reiterated his regret. He called the contract to hire Cohen for insight into the Trump presidency a "bad mistake," but said he had nothing else to add. 

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