It’s become something of a nonchalant joke the last few years, that Disney was charting a course for world domination. Turns out it may not be the world they’re after, but all media, they’ve set their eyes on. In a surprising, but not all that unexpected move, it’s been announced that effective immediately Disney now has operational control of Hulu. The move comes as Comcast has reached a deal with the mega corporation, that will hand them over all of their stake in the company, within the next several years.
Here’s the full text of the provided press release, that Disney formally put out today:
The Walt Disney Company and Comcast Corporation announced today that Disney will assume full operational control of Hulu, effective immediately, in return for Disney and Comcast entering into a “put/call” agreement regarding NBCUniversal’s 33% ownership interest in Hulu. Under the put/call agreement, as early as January 2024, Comcast can require Disney to buy NBCUniversal’s interest in Hulu and Disney can require NBCUniversal to sell that interest to Disney for its fair market value at that future time. Hulu’s fair market value will be assessed by independent experts but Disney has guaranteed a sale price for Comcast that represents a minimum total equity value of Hulu at that time of $27.5 billion.
So, how did we get here and what does it mean for the future of Hulu? Well, the easiest place to start is by stating that this has been Disney’s plan all along. When Hulu first began, it was a joint venture, split between 20th Century Fox, NBCUniversal and Disney. With each party having a 30% equal share. Time Warner was the last to be added to the deal, with a smaller 10% share. Needless to say, the past three months has seen a big change to all that. Disney’s Fox deal going through in March, was just the tipping point. AT&T (who now owns WarnerMedia) handed over their shares, last month. Today’s news is merely one of the final nails in the coffin, to the Hulu that once was.
Again, this shouldn’t entirely come as a shock to anyone. The last few years has seen some of the biggest media companies jockeying for a way to best combat the rise of Netflix. Disney has Disney+ set to launch later this year. WarnerMedia has their own plans for a streaming service too. If anything, this just makes CBS looks rather smart. First, for never getting into the Hulu business. Secondly, for setting up CBS All Access well before everyone else was forced to follow suit.
At the same time, this new landscape doesn’t mean the face of Hulu changes over night. The NBCUniversal shows that are on the platform currently, will stay there. For another three years, at least. Then, slowly but surely they’ll make their way to whatever subscription service Comcast plans to roll out. The same goes for Hulu Originals like The Handmaid’s Tale. They too are staying put, for a decidedly different reason. That’s because Disney CEO Bob Iger, actually spoke back in 2017 of viewing Hulu as a place to put more adult-oriented programing.
“There’s a lot of Fox intellectual property that fits extremely well into Disney-branded direct-to-consumer services. There’s a lot of product that we believe will be of great use to growing Hulu as it already is. Hulu is a more adult-oriented product [that will benefit from] Fox television production and FX.”
In a way, this is just a sign of the times. The natural end point that started with the rise of streaming services and the natural inclination that the common consumer wanted to move away from cable. These four media giants wanted to offer an alternative to people, with the promise of only having to wait a day to see most of their beloved shows. Yet, in the long run it lead to the seeds of them all wanting a bigger piece of the pie. One that will effectively see people purchasing a handful of a la carte subscriptions to various streaming services. Which is to say, don’t cancel on Hulu just yet. At least, not until the Disney corporate overlords say it’s ok.