Disney Hulu Ownership Complete After Deal With Comcast

Disney Assumes Full Control of Hulu in Deal With Comcast

Disney Assumes Full Control of Hulu in Deal With Comcast

Comcast Corp. has agreed to give Walt Disney Co. full control of Hulu in a deal that pegs the value on the streaming service of $27.5 billion US and lays the groundwork for the creation of a powerful competitor for Netflix Inc.

Disney and Comcast will enter a "put/call" agreement regarding NBC's 33% ownership interest in Hulu.

As to the question of why Disney would want more control of Hulu when they already have Disney+ coming this fall, it's simple: With the purchase of Fox and its many shows and films, they now control content that wouldn't fit on Disney+ because it's too graphic or too adult or just too weird.

Now, nothing is changing for NBCUniversal content (which is owned by Comcast) right away.

Comcast also agreed to extend its NBCUniversal distribution agreement with Hulu's on-demand and live TV services until late 2024.

From January 2024, either Comcast or Disney can oblige the other side to begin the sales process - independent auditors will determine the final valuation of Comcast's stake, though Disney has guaranteed a floor price of $27.5 billion. Last month, WarnerMedia - now owned by AT&T - agreed to sell its 9.5% interest back to Hulu.

Disney is preparing to launch its own streaming service called Disney+ on November 12. Disney has forecast that Hulu will turn a profit around then. But now Disney has negotiated a deal with Comcast, which sees Disney pick up full control of Hulu beginning today.

But Hulu is beefing up its original content offerings.

The juggernaut that is Disney is launching its own streaming service soon. It's a free service and therefore will rely on ad-supported content to generate a profit.

So what does this mean for NBCUniversal's library of TV shows and movies on the service? In a year, its streaming service can also start offering video that's now exclusive on Hulu, sharing the shows with Hulu for the time being.

"The move enables an global launch for the service". Comcast agreed to sell its stake within five years for at least $5.8 billion.

To preserve the ability to run NBCUniversal program on its own service, NBCUniversal will have the option to offer some of the shows it now licenses exclusively to Hulu in one year's time in exchange for lower license fees.