It’s not often that buying one of the most recognizable businesses in America can be considered a gamble, but in the case of AT&T (NYSE:T) stock, the bull thesis is a bit of a long shot.

AT&T is in the midst of a massive overhaul that will either leave it  debt-laden and crippled or change the media landscape forever. T stock has become a polarizing investment option, with many betting against CEO Randall Stephenson’s grand vision and an equal number watching in awe as he works to reshape the company. While there’s a good chance that things could go sideways for the telecom company, the reward for believers in T stock is likely to be a handsome one. 

The Vision

To get on board with bulls’ contentions on T stock, you have to understand Stephenson’s vision for the future of AT&T. The telecom sector is slogging through uncertain times right now, and both AT&T and Verizon (NYSE:VZ) knew something would have to change. However the two took diverging paths, with VZ doubling down on its wireless business and T entering more sectors.

Verizon has certainly taken the safer option, but in the long-term will it be better? If AT&T is able to execute on its strategy, I’d argue that T stock will be the winner in a few years’ time. AT&T acquired DirecTV and Time Warner as part of a larger plan to bundle services together.

Many scoffed at Stephenson’s plans to bundle AT&T’s wireless plans together with Time Warner’s HBO streaming platform and, eventually, AT&T’s own streaming network, because research shows that people are moving away from traditional cable bundles and opting instead for individual streaming services like Netflix (NASDAQ:NFLX). 

However, if you look at it from another angle, Stephenson is creating an ecosystem which, if successful, will be very powerful. He is planning to offer people the media streaming  and the connectivity they need from the wireless industry, all under one umbrella. If it’s successful, it will be brilliant.

Streaming Success

A huge part of T stock’s future hinges on whether or not the firm can produce a streaming service that can compete with the likes of Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX) and Walt Disney (NYSE:DIS)-owned Hulu. The ingredients are all there- AT&T now owns Time Warner’s extremely successful film and TV studios. All that’s left is execution. 

If AT&T’s streaming service grows in-line with Stephenson’s plans,   the benefits will be vast. For one, the firm will have created an ecosystem with high switching costs that will help the company add and hold onto customers. Even more appealing to the owners of T stock is the advertising potential. AT&T’s customer data will make it easier for advertisers to target specific individuals as well as evaluate how their ads are performing. 

The Risks

Of course, there are a lot of risks associated with this kind of mega-shift that have the potential to cause AT&T stock price to crash even further. First of all, there’s the immense competition in the streaming space. It’s unclear exactly how many players can survive, and right now competition in the sector is fierce. But even if T’s streaming bets do pay off, AT&T might find itself fending off privacy complaints like Alphabet (NASDAQ:GOOGL,NASDAQ:GOOG) and Facebook (NASDAQ:FB) have. 

The AT&T of the future will be able to to show its customers targeted ads based on their preferences and location. Since AT&T will also have access to location data from its wireless subscribers, the firm can inform advertisers whether the consumers to whom they showed ads subsequently visited a nearby store. While that could provide a huge boost to T stock, it also has the potential to become a regulatory nightmare.

The Bottom Line on T Stock

I’m a believer in Stephenson’s grand plan. AT&T as he envisions it could become a powerhouse in both the media and the telecom sector. AT&T stock price is a bargain if you believe that the firm can pull off its transformation. Plus, T stock has a 6.3% dividend yield that will help make the wait a little bit more bearable. For investors who can wait out a few bumps and stomach the risk, T stock is worth considering.

As of this writing Laura Hoy was long AMZN, NFLX and T.