Why AT&T chose Jason Kilar as WarnerMedia CEO

In 2011 Jason Kilar, the founding chief executive of streaming darling Hulu, wrote a blog post on the company’s website offering thoughts on the state of conventional television. In traditional TV, he wrote, there were too many ads, programming was too inconvenient to watch when you wanted, and shows were ultimately at the mercy—in ways good and bad—of viewers empowered by social media.

Hollywood observers swiftly interpreted it as a scathing critique of his big media partner-owners, rather than a reflection of changing viewing habits. How much of a stir did Kilar cause? Enough to justify next-day news coverage asking, “Is Jason Kilar Trying to Get Fired?” (He wasn’t.)

It would be difficult to imagine, then, that Kilar would end up working for the big-media giant behind the cable networks CNN, TBS, and TNT. But that’s exactly what happened nine years later. On Wednesday, WarnerMedia—the AT&T-owned successor company to Time Warner, a former Hulu big media partner-owner—named him CEO. Kilar replaces John Stankey, who was promoted to AT&T president and chief operating officer.

It’s not difficult to see why AT&T tapped the onetime media “bad boy.” In time, Kilar’s views about the future of the TV were largely proven right. In 2020 on-demand streaming services dominate the entertainment landscape, cord-cutting is rampant, and the most popular video subscription service—Hulu’s longtime nemesis Netflix—is ad-free. Today’s big media companies aspire to be more like Hulu than their old selves.

WarnerMedia’s HBO, for example, is gearing up to launch a streaming service of its own called HBO Max that will offer premium content from HBO, The CW, and other WarnerMedia brands, along with exclusively licensed series like Friends and The Big Bang Theory—both of which were originally co-produced by Warner Bros. Television. Given the intense competitive landscape before it, who else better to lead such efforts than the former streaming boss who argued nearly a decade ago that “rapid innovation, low margins, and customer obsession” would define the winners of paid television?

The only lingering question is why Kilar, 48, joined a media conglomerate after spending so many years fighting what they stood for. In a brief exchange, he offered longtime industry observer Peter Kafka a mere clue: that WarnerMedia was “a good place to operate” given the instability of the broader media industry. (Neither Kilar nor his new employer responded to Fortune requests for comment.) No kidding: In only a few weeks’ time, the novel coronavirus pandemic has brought film and television production to a halt and strained the pockets of consumers who will need to be convinced to subscribe to yet another streaming service.

“I think there’s only reason he took the job: He’s got buy-in from management to create a long-term strategy, rather than relying on legacy thinking,” says Rich Greenfield, a partner at media and technology research firm LightShed. “He was the one who wanted things to be shaken up far more at Hulu. The three-headed monster [of News Corp., Disney, and Comcast] refused to let him, and he left.”

Kilar, it’s worth noting, will have veteran leaders by his side as he enters the picture. Robert Greenblatt, a former chairman of NBC Entertainment who now heads up entertainment at WarnerMedia, and Jeff Zucker, the CNN president tasked with overseeing all live programming and sports, will report to him. Both were viewed as leading internal candidates for Kilar’s job.

“They have people who have media experience from different aspects, so now you have the pieces reset as a media company that’s part of a larger mobile phone company,” says media analyst Bruce Leichtman. “The new leadership needs to think how to get all these segments to fit together.”

Integration issues aside, Greenfield believes Kilar’s arrival at WarnerMedia reflects positively for AT&T, which drew fire last year from investor Elliott Management Corp. for “confusion over strategy and a growing sense that AT&T doesn’t have a plan” for its $85 billion prize. (The parties came to agreement in October.)

“This is AT&T thinking out of the box,” Greenfield says of Kilar’s hire. “This is an admission that the media world is changing, that we need to have someone who truly lives at the intersection of media and technology.”