FirstFT: Today’s top stories | Financial Times

AT&T has agreed to spin off and combine WarnerMedia with its rival Discovery in a multibillion-dollar deal to create a media empire that has the programming heft to compete with Disney and Netflix in a global streaming race.

The move will create the second largest media company in the world by revenue after Disney. It comes just three years after AT&T paid $85.4bn for the owner of CNN, HBO and Warner Bros and reflects the breakneck pace of change for traditional US media groups attempting to reinvent themselves as streaming services.

Under the proposed tie-up, one of Hollywood’s most prized portfolios — including Warner Bros film and television studios, the HBO network and a portfolio of cable channels including CNN — will be brought together with the “real life” output of Discovery, whose brands range from sport and wildlife to home renovation.

AT&T over the past decade has tried to move beyond its mobile, broadband and wireline phone businesses to be a serious Hollywood player. Instead, its two big acquisitions — Time Warner and DirecTV in 2014 for $67bn — proved to be millstones, says the Lex column.

Coronavirus digest

• The World Economic Forum has scrapped its plans for an in-person annual meeting once again, cancelling a gathering planned for August in Singapore.

• Taiwan is seeing a surge in Covid-19 cases, with about 34 per cent of its total Covid-19 cases being reported in the past week.

• A leading Indian scientist has resigned from a government-appointed Covid-19 task force days after publicly criticising Narendra Modi’s government.

• US president Joe Biden has announced plans to export an additional 20m doses of Covid-19 vaccines by the end of June.

• Brussels plans to throw its weight behind a new push to expand vaccine manufacturing in Africa. (FT, Reuters)

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In the news

Israel steps up Gaza attacks as diplomacy stalls Israel’s bombing of the Gaza Strip stretched into a second week on Monday as Prime Minister Benjamin Netanyahu resisted international efforts to secure a ceasefire. The conflict has rattled Israel’s ties with a third of the Arab world, but it may have resurrected Benjamin Netanyahu’s political fortunes.

Gates says affair probe not related to Microsoft board exit Bill Gates has denied that Microsoft’s investigation into an “intimate relationship” with an employee two decades ago had any impact on his decision to leave the software company’s board last year.

Thousands evacuate, 16 killed as cyclone hits India At least 16 people have been killed as Cyclone Tauktae blew past coastal states Kerala, Karnataka, Goa and Maharashtra, and later made landfall in Gujarat. Indian authorities moved 200,000 people from their homes in preparation for the storm. (Guardian)

Musk impersonators stole $2m in cryptocurrency scams Scammers impersonating Elon Musk have stolen millions of dollars from US consumers in cryptocurrency scams as online financial fraudsters seek to capitalise on public interest in trading highly volatile cryptocurrencies such as bitcoin.

Jimmy Lai’s Hong Kong media group in doubt A Hong Kong media company controlled by Jimmy Lai halted trading of its shares on Monday after authorities froze the jailed pro-democracy campaigner’s assets under the territory’s national security law. The halt came as Lai and nine other activists pleaded guilty to a charge of organising an “unauthorised assembly”.

Indonesia’s Gojek and Tokopedia agree $18bn merger Indonesia’s two biggest start-ups have agreed a merger that will create an $18bn food delivery, ride-hailing and ecommerce group with reach across south-east Asia. Separately, JD Logistics, the delivery unit of Chinese ecommerce group JD.com, will seek to raise up to $3.4bn in a Hong Kong IPO this year.

Chinese corporate bond downgrades accelerate Domestic rating downgrades of corporate bonds in China have more than tripled this year, underlining Beijing’s efforts to reduce risk in the country’s $17tn credit market in the wake of several high-profile defaults.

South Korea vows action on climate in response to critics South Korea’s climate envoy has promised “bold” policy changes from Seoul as one of Asia’s biggest greenhouse gas emitters comes under pressure for failing to act more forcefully to combat climate change.

The day ahead

Japan growth figures Japan’s economy is set to grow more slowly than expected this quarter, coming in at 4.5 per cent growth, according to a Reuters poll. Preliminary GDP figures are out on Tuesday. (Reuters)

UK monthly unemployment figures Unemployment data for April is set to be released. Last month, joblessness in the UK dropped to 4.9 per cent in the three months to February.

The FT launches a new email today on markets and the people and companies that live and die by them. Written by US financial editor Robert Armstrong, it will land in inboxes each weekday morning. Sign up to “Unhedged”.

What else we’re reading

Disruption in the era of electric vehicles Foxconn, the Apple iPhone maker, is spearheading an assault by electronics groups on the auto industry, and their push into EV manufacturing could also make it easier for Apple, its largest customer, to enter the car market.

Netanyahu’s master plan for Israel and Palestine has failed Israeli prime minister Benjamin Netanyahu’s strategy may have increased the threat to his country — by inadvertently opening up a new front, within Israel itself, writes Gideon Rachman. That threat will remain, even after the pummelling of Gaza has stopped.

The sinister PR push that links cyber criminals to CEOs Hackers are increasingly using corporate tools, from “ethical” codes to legalese, to attack companies themselves. After the cyber criminal group DarkSide was blamed for shutting down a vital US fuel pipeline with ransomware, it issued a statement that read for the most part like a standard piece of public relations guff, writes Andrew Hill.

The year without karaoke Absent vaccines, singing and shouting in a small, poorly ventilated room, while passing around a shared microphone is about as risky as it gets when it comes to contracting Covid-19. Self-professed karaoke lovers share what a year without their favourite pastime has meant. (FiveThirtyEight)

Inflation: will central banks and investors hold their nerve? A summer burst of inflation was inevitable once lockdown measures began to ease. But central bankers’ assurances that price rises are temporary have not calmed investors’ nerves. Investors will have to make a call on whether the shift is transitory or a regime change.

Colombia’s social unrest could spread Colombia this month looks uncannily similar to Chile in 2019. President Iván Duque’s “Sustainable Solidarity Law” has proved anything but for residents of one of the world’s most unequal countries. And across the region, tempers are fraying, writes Latin America editor Michael Stott.

How to avoid the return of office cliques After weighing up the pros and cons of future working patterns, Dropbox decided against the hybrid model. It opted for a virtual-first policy, which prioritises remote work over the office. Status-conscious workers may be itching to return to the office but this could create a two-tier workforce, warns one expert.

Video of the day

Why internet freedom is under threat Is the dream of a free and accessible internet already dead? The FT’s Siddharth Venkataramakrishnan examines how different philosophical, political and social attitudes towards online privacy are creating a ‘splinternet’