In an effort to compete with streaming giant Netflix, Disney and Comcast have announced that Disney will now assume full operational control over Hulu, effective immediately. Under the deal, Comcast’s NBCUniversal will continue to license content to Hulu through the end of 2024.
Next year, NBCU will be able to pull programming previously licensed exclusively to Hulu, and by 2022, NBCUniversal will have the right to cancel most of its content-licensing agreements with Hulu. Disney now has the ability to create a new strategy for Hulu, which includes an international launch of the streaming service.
While parts of the deal are still being worked out, Comcast/NBCU will retain its 33% ownership interest in Hulu, and as early as January 2024, Comcast could require Disney to buy NBCU’s interest in Hulu. Disney‘s guaranteed sale price for Comcast’s stake in Hulu represents a valuation for the joint venture at almost $27.5 billion.
NBCU CEO Steve Burke called the deal the “perfect outcome.” He said in a statement, “We believe strongly in the direct-to-consumer space, and our content is a key driver of that ecosystem. The extension of the Hulu content-licensing agreement will generate significant cash flow for us while giving us maximum flexibility to program and distribute to our own direct-to-consumer platform, as we build that business. Significantly, this transaction also affirms the value of our stake, provides a path to liquidity and ensures our continued equity participation in Hulu’s success.”
According to Variety, AT&T sold its 9.5% stake in Hulu to Disney and NBCU for $1.43 billion, valuing Hulu at $15 billion. Disney and Comcast agreed to allocate the purchase, giving Disney a 66% ownership while Comcast/NBCU keeps their stake.
How do you think the change in ownership will affect the content Hulu provides?