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   who ran Bad Robot, their production company.   
      
   Ms. McGrath had emerged as an outspoken champion of the #MeToo movement   
   and was a co-founder of Time’s Up, a Hollywood initiative to fight sexual   
   harassment. She told Mr. Stankey that it wasn’t her place to tell him how   
   to run his company, but that Bad Robot couldn’t be associated with a   
   studio run by Mr. Tsujihara.   
      
   Mr. Stankey announced Mr. Tsujihara’s departure two weeks later. “Kevin   
   has acknowledged that his mistakes are inconsistent with the company’s   
   leadership expectations and could impact the company’s ability to execute   
   going forward,” Mr. Stankey wrote in a memo to employees.   
      
   Warner Media reached a five-year deal with Mr. Abrams and Ms. McGrath,   
   agreeing to pay $250 million to keep Bad Robot producing under the Warner   
   Media umbrella.   
      
   Mr. Stankey appeared to anguish over the decision to force out Mr.   
   Tsujihara. He insisted on giving Mr. Tsujihara two going-away parties, one   
   in Hollywood on a Warner soundstage, the other in New York at the Mandarin   
   Oriental hotel. Under the circumstances, both were awkward affairs.   
      
   To replace Mr. Tsujihara, Mr. Stankey passed over a couple of internal   
   candidates, Toby Emmerich, chairman of the movie studio, and Peter Roth,   
   in charge of television, both well known and respected in Hollywood, and   
   named Ann Sarnoff, the first woman to run the studio.   
      
   While the added diversity at the homogeneous, male-dominated AT&T (not to   
   mention Warner) was widely applauded, Ms. Sarnoff’s résumé left many   
   industry participants scratching their heads: Her previous duties were at   
   BBC Worldwide North America; Dow Jones (publisher of The Wall Street   
   Journal), where she oversaw the conference business; and the Women’s   
   National Basketball Association.   
      
   Mr. Stankey seemed impressed with her successful launch of BritBox, a BBC   
   streaming channel, and praised her as a “great cultural fit” for Warner   
   Media.   
      
   No joint ventures   
   One way to reduce costs while expanding a viable streaming service was to   
   enter into joint ventures. Mr. Stankey met with David Zaslav, the chief   
   executive of Discovery, which owned a portfolio of nonfiction and reality   
   cable channels.   
      
   He also met with Comcast’s chairman, Brian Roberts, and NBCUniversal’s Mr.   
   Burke. Together, NBCUniversal and Warner television had 14 of the top   
   comedies of all time, including NBCUniversal’s “30 Rock,” “The Office” and   
   “Cheers” and Warner’s “Friends” and “Seinfeld.”   
      
   Neither encounter led to any deal. Mr. Stankey told people that he didn’t   
   believe in joint ventures and would never co-run a business.   
      
   AT&T’s costly, go-it-alone strategy and the management upheavals at Warner   
   Media attracted the attention of Paul Singer, the activist investor and   
   hedge fund manager known for his libertarian politics and large   
   contributions to Republican candidates. In September 2019, his investment   
   firm, Elliott Investment Management, disclosed a $3.2 billion stake in   
   AT&T and called for management changes.   
      
   The firm was especially critical of the Time Warner deal, writing in a   
   letter to the board that more than a year later, AT&T had “yet to   
   articulate a clear strategic rationale” for the combination. The letter   
   added, “There is still confusion over strategy and a growing sense that   
   AT&T doesn’t have a plan.”   
      
   Elliott backed off and sold a portion of its stake in October 2020 after   
   AT&T pledged not to make any other major acquisitions.   
      
   AT&T’s stock was trading at just over $24, $8 below where it was when   
   Elliott announced its stake. Casey Friedman, a spokeswoman for Elliott,   
   said its overall investment in AT&T has been profitable.   
      
   Leading ‘AT&T into the future’   
   The financial implications of AT&T’s strategy were unmistakable by the end   
   of 2019 — the first full year AT&T had owned Warner Media — and the first   
   quarter of 2020, even before the pandemic upended Americans’ lives and the   
   entertainment business. That quarter, AT&T reported that Warner Media’s   
   revenue had declined a billion dollars from the year before, and earnings   
   dropped 22.8 percent.   
      
   AT&T didn’t offer much of an explanation but cited lower revenue from the   
   licensing deals it had terminated in anticipation of the launch of HBO   
   Max, scheduled for May.   
      
   The day the results were announced, AT&T said Mr. Stankey would replace   
   Mr. Stephenson as chief executive.   
      
   Mr. Stephenson, who had recommended Mr. Stankey to the board, noted that   
   there were many candidates to run a telecommunications company and many to   
   run a media company — but virtually none with experience running both. As   
   he departed, Mr. Stephenson hailed Mr. Stankey as “the right person to   
   lead AT&T into the future.”   
      
   That opened up the top job at Warner Media less than two years after Mr.   
   Stankey had taken it. One candidate seemed to be right in front of him:   
   Jeff Zucker, who had overseen the creation of Hulu while at NBCUniversal   
   and was much admired within Warner Media for his profitable stewardship of   
   CNN.   
      
   Mr. Stankey did consider Mr. Zucker for the job. But that April, he   
   announced that Jason Kilar — who had once worked for Mr. Zucker — would be   
   the next chief executive of Warner Media.   
      
   The news surprised Mr. Zucker. Although he was well aware of Mr. Kilar’s   
   strengths and weaknesses, Mr. Stankey had never asked his opinion about   
   him.   
      
   Like Ms. Sarnoff, Mr. Kilar had a more unconventional résumé by Hollywood   
   standards. With a Harvard M.B.A., he had spent nine years at Amazon’s   
   software division before joining Hulu. While the experience made him a   
   streaming pioneer, Mr. Kilar hadn’t been at Hulu for several years.   
   Moreover, Hulu was relatively small (2,400 employees in 2019) while Warner   
   Media had nearly 30,000 employees.   
      
   HBO Max debuted in May 2020 with 10,000 hours of programming, including   
   “Game of Thrones,” “Friends” and the Harry Potter movies. But it lacked a   
   major original new series like the Disney+ streaming hit “The   
   Mandalorian.” It also carried a premium price by streaming standards,   
   locked in by HBO’s monthly fee of $14.99.   
      
   A month later, Mr. Stankey announced that HBO Max had attracted four   
   million subscribers, which he said was ahead of projection. Mr. Kilar   
   fired Mr. Greenblatt soon after, as he consolidated HBO, HBO Max and the   
   Warner Bros. studio into one administrative unit.   
      
   By December 2020, HBO Max had attracted only 12.6 million subscribers. In   
   contrast, Disney+ had signed up 10 million on its first day. That   
   December, Disney was at 87 million subscribers. HBO Max’s archrival,   
   Netflix, stood at 195 million.   
      
   From a ‘win, win, win’ to a loss   
   Mr. Kilar embraced the promise of streaming with almost religious fervor.   
   He told Mr. Zucker that he wanted CNN to start a stand-alone streaming   
   news service of its own, later named CNN+, Mr. Zucker recalled.   
      
   Mr. Kilar told him that he believed AT&T intended to spin off Warner Media   
   and, given Wall Street’s infatuation with streaming, a stand-alone news   
   service alongside HBO Max would add value.   
      
   Mr. Zucker thought a separate news streaming service would make sense   
   someday, but not yet. He thought he might be able to “slow walk” the idea,   
   he recalled. But Mr. Kilar insisted. Mr. Zucker dutifully got on board,   
   but without any great enthusiasm. (In a recent interview, Mr. Kilar said   
   Mr. Zucker had never communicated any hesitation about CNN+ to him.)   
      
   To many in Hollywood, Mr. Kilar’s (and Mr. Stankey’s) lack of experience   
   was on display that December when Mr. Kilar announced that all of Warner’s   
      
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