The scene has been set for the creation of yet another streaming giant vying for consumer attention, through the planned merger of AT&T’s Warner Media with Discovery.

The landmark deal will see the two companies become the second largest media group by revenue after Disney, with $41bn in sales annually as it brings together movie giant Warner Bros, HBO and other networks along with Discovery Channel, Animal Planet, TLC and more.

“This agreement unites two entertainment leaders with complementary content strengths and positions the new company to be one of the leading global direct-to-consumer streaming platforms,” AT&T chief executive, John Stankey said in a statement.

“It will support the fantastic growth and international launch of HBO Max with Discovery’s global footprint and create efficiencies which can be re-invested in producing more great content to give consumers what they want.”

The joint company – still in the process of decided a new moniker, with suggestions including Warner Discovery, Warner Bros Discovery and Warner Discovery Media – will be lead by Discovery’s president and chief executive, David Zaslav, who has said that the combined company would spend around $20 billion a year on content. 

Zaslav has suggested that the company could see its annual sales hit $52bn by 2023.

The merger will sit among some of the most significant deals of the past five years, alongside Disney’s purchase of Rupert Murdoch’s Fox empire, and AT&T’s acquisition of Time Warner. It is part of a plan to increase AT&T’s content pool as the streaming race intensifies further.

Netflix is leading the race to date with over 200 million subscribers, while Disney+ boasts its 104 million. Both HBO and Discovery entered the race recently with the launch of HBO Max and Discovery+. HBO Max, together with the HBO cable network has around 44 million customers, while Discovery has 15 million global streaming subscribers.

For WarnerMedia, the deal will mark the third restructuring in as many years.