Disney is buying out Comcast's stake in Hulu for $8.6 billion

[Shawn Knight]

Recap: Disney has announced plans to purchase Comcast's one-third stake in Hulu, the streaming service that was founded in 2007 and has had multiple shareholders over the years. Most recently, in 2019, Disney acquired 21st Century Fox which came with a 60 percent stake in Hulu.

A few months later, Hulu bought back AT&T's share of the company, leaving Disney with a 67 percent stake and Comcast with the remaining 33 percent share.

At the time, Comcast and Disney entered into a put / call agreement with a minimum guaranteed floor value of $27.5 billion for Hulu. Disney will pay fair value for Comcast's remaining stake in Hulu, an amount that will be determined based on an appraisal of value as of September 30, 2023, but is expected to be in the ballpark of $8.61 billion (which is to be paid by December 1). If the appraisal comes back higher than the floor value, Disney will pay Comcast's NBC Universal its percentage of the difference between the equity fair value and the guaranteed floor value.

Disney said it anticipates the appraisal process to be completed sometime during calendar year 2024, and that the deal will further its streaming objectives.

Share value in Disney is up 2.39 percent on the news as of this writing. Comcast is trading up 0.72 percent on the day, at $42.13 as of writing.

Disney already offers Hulu as part of the Disney Bundle, which additionally includes access to Disney+ and ESPN+ for one monthly price. Bundle plans that include access to all three services start at $14.99 per month (with ads).

The deal comes at a time when prices for streaming services continue to rise with seemingly no end in sight. Over the summer, Disney hiked rates for Disney+ and the ad-free version of Hulu. Netflix just last month confirmed it is increasing subscription prices again, and Apple last week announced higher prices for most of its streaming services (some by more than 40 percent).

Image credit: Glenn Carstens-Peters

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https://www.techspot.com/news/100712-disney-buying-out-comcast-stake-hulu-861-billion.html

 

[wiyosaya]

IMO, if they keep raising prices, they will drive subscribers away.

I subscribed to a special for hulu and disney last november for $4.99/mo for 12 months. I've just entered my last month, and I am cancelling my subscription.

 

[TomSEA]

I tried HULU for a while and the ads were obnoxious and frequent. Not worth what I was paying. Cancelled after 3 months.

 

[fps4ever]

IMO, if they keep raising prices, they will drive subscribers away.

I subscribed to a special for hulu and disney last november for $4.99/mo for 12 months. I've just entered my last month, and I am cancelling my subscription.

What is that like a special tier no new video's after 1980 or something?

 

[Neatfeatguy]

My brother pays for Hulu and he still gets to watch ads. What a loser!

 

[SirDigby]

Hmm I wonder if Disney will condense them all into Disney+ like they do in the UK, save on operating costs and whatnot.
As someone who works for a Comcast owned business, I hope this is good for us too. I've got a share plan that cashes out in 2026 that I could really do with!

 

[dangh]

More consolidation, less competition. Nothing good for consumers.

 

[Theinsanegamer]

More consolidation, less competition. Nothing good for consumers.

Disney already owned 2/3rds of hulu, and comcast has their own streaming services. There has been no consolidation.

 

[lripplinger]

Disney must be rolling in money from Black Rock, State Street or Vanguard. Given Disney's abysmal earnings call, where else is the money going to come from?

 

[wiyosaya]

Hmm I wonder if Disney will condense them all into Disney+ like they do in the UK, save on operating costs and whatnot.
As someone who works for a Comcast owned business, I hope this is good for us too. I've got a share plan that cashes out in 2026 that I could really do with!

Disney pushed out a new version of their app last week in the US - at least I got it. There was something on the app that said that they would be offering "package deals" for Disney+, Hulu, and ESPN+ in the US. I did not pay attention to exactly what it said because I'm not really interested.

And I did cancel my subscription to Hulu last night as I was at the end of the year's $4.99/mo deal. Even if I were able to get the same Hulu+/Disney+ package at $4.99/mo going forward, I doubt I would continue subscribing. IMO, the Marvel series are just not that interesting, and the star wars series seem to be turning into "The Battles of the Light Sabres." Season 2 of Ahsoka could get interesting if they explore the pre-star wars mythology, but if it turns into dueling Light Sabres, I'll pass. Probably sometime next year, I'll resubscribe for a month, get caught up, then unsubscribe again.

 

[wiyosaya]

Disney must be rolling in money from Black Rock, State Street or Vanguard. Given Disney's abysmal earnings call, where else is the money going to come from?

Disney has no one but themselves to blame for how poorly their streaming service is doing. All they saw when they started it was that it was a fad that people were jumping onto and they thought, mistakenly, that those same people would gladly pay anything to stream their content. In other words, they just saw money, money, money, and more money. IMO, they got it wrong as to why people were "cord cutting" like I did. I "cord cut" dish network because I was tired of paying $85/mo to watch five channels one of which I was able to get free OTA.

I suspect others "cord cut" for similar reasons. Then what do these content CEO dolts do? Give us essentially the same, way over-priced model as Cable/Satellite and expect us to like it. In other words, they are doing the same thing over and over again and expecting different results. IMO, Einstein was right to define that as insanity.

I was perfectly happy streaming Disney's content, and others, too, on Netflix. From my standpoint, it was the perfect model. Honestly, I would not be surprised if in a few years time, when these fad-following content providers have endured enough pain, that they decide to go back to licensing their content to Netflix.

 

[FaTaL]

Hulu streaming service absolutely sucks. its the only service that cannot buffer video content efficiently..would always get loading bar or mass pixelation with live or VOD content......I had live TV and got rid of it went to YoutubeTV (way better). Their interface also sucks *** and doesnt take advantage of fire Cube that majority of people use..