When AT&T shortly takes control of Time Warner, it aims to put a bigger emphasis on direct-to-consumer streaming services that it can promote with its cellular phone offerings. HBO, which operates the HBO Now streaming service, will be key to those plans, said a person familiar with AT&T’s thinking.

But to make HBO more competitive with fast-growing rivals like Netflix, AT&T will have to ramp up investment. The Time Warner unit is being vastly outspent by Netflix on programming—HBO spent $2.3 billion last year to Netflix’s $6 billion. Just as an example, The Information has learned that Netflix recently outbid HBO for the rights to carry “Springsteen on Broadway.”