The Wall Street Journal
AT&T plunges into programming and advertising, while Verizon banks on a network built to milk 5G technology
A maturing wireless industry has drawn sharply different responses from industry leadersAT&T Inc. T +0.95% and Verizon Communications Inc., VZ +0.88% two companies that used to move in tandem.
AT&T is diving headfirst into entertainment and advertising, spending tens of billions of dollars to control in-demand programming like HBO’s “Game of Thrones” and live National Basketball Association games on TNT that it can distribute throughout its wireless, satellite and fiber-optic networks. Verizon, meanwhile, is doubling down on wireless-network upgrades to enable the commercial use of 5G technology, counting on industrial and consumer uses beyond smartphones to deliver a fresh wave of revenue. The media assets it owns sit in a small unit that includes advertising technology and an eclectic group of websites like HuffPost and Yahoo Sports. AT&T and Verizon are the two largest wireless carriers in the U.S. by total subscribers. But they’re under pressure to find new sources of revenue beyond wireless services, where there is limited room for growth. Software and media companies have captured most of the earnings from a mobile economy built atop wireless networks, a fact not lost on either company. “Both of them have suffered from Google envy almost from the beginning,” says Roger Entner, chief of wireless-industry research firm Recon Analytics Inc. “They are looking at the same facts and came up with vastly different decisions.” The different game plans have driven a divergence of stocks that used to move in the same direction. AT&T shares have slid 10% over the past year as investors worry about its debt burden. Verizon shares have gained 30% over the past 12 months after five years stuck in neutral.Mr. FitzGerald is a Wall Street Journal reporter in Washington. Ms. Krouse is a Wall Street Journal reporter in New York. They can be reached at email@example.com firstname.lastname@example.org.