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(Bloomberg) – Walt Disney Co. will take full control of Hulu as part of an agreement with co-owner Comcast Corp., which expects a streaming service value of $ 27 billion in five years.
The agreement announced Tuesday represents a big Disney bet on the continued rapid growth of Hulu, home to such original hits as "The Handmaid's Tale". Under the terms of the deal, Comcast will benefit from a $ 5.8 billion windfall early in 2024, when the cable giant will be able to sell its stake to Disney.
Hulu will be a vital weapon in the growing online fight between Disney and Netflix Inc., and the deal gives the service access to programming from Comcast's NBCUniversal division for at least three years. Disney expects Hulu to have no less than 60 million subscribers by 2024, up from 25 million last year, and is counting on it to complete the new broadcast service. continuously Disney + launched in November.
"We are now able to fully integrate Hulu into our direct-to-consumer business," said Disney General Manager Bob Iger in a statement.
Investors from both companies seemed pleased. Disney's shares climbed 2.1% and Comcast's shares climbed 2.3%.
The transaction, which leaves Hulu headed for the first time by a single media company, marks the end of one of the most complex entertainment sagas.
NBC and Fox founded Hulu over ten years ago to allow viewers to watch TV from yesterday online. Disney acquired a stake later, and the three media giants competed for Hulu's leadership while Netflix doubled in size. Netflix now has a market capitalization of $ 152 billion, 10 times the most recent valuation of Hulu.
Majority owner
Disney acquired majority ownership of Hulu this year by buying Fox's stake in its $ 71 billion acquisition of Rupert Murdoch's entertainment empire. Just one month ago, Hulu rose to $ 15 billion, when Disney organized the acquisition of AT & T Inc.'s 9.5% stake.
Disney will share its TV shows and movies between two streaming services, Disney + and Hulu. Disney + will offer programming from Marvel, Pixar and Star Wars. FX's broadcasts of "Sons of Anarchy" and "American Horror Story" will be broadcast on Hulu, said FX CEO John Landgraf. The content of NatGeo will be on both services.
"I do not see any FX in Disney +," Landgraf said at a press briefing featuring presentations from the leaders of most of Disney's television networks. Landgraf said he wanted FX to be its own standalone premium service. But, because of the consolidation of the sector, this makes sense now as an integral part of Hulu Online.
What Bloomberg Intelligence says
"The move allows for an international launch of the service. Disney expects Hulu will reach 40 to 60 million domestic subscribers in five years, or 150 million customers worldwide, based on a 33% nationwide distribution. Geetha Ranganathan, Media Analyst Click here to search.
Disney and Comcast will sign a sales agreement on NBC's 33% stake in Hulu, promising the cable giant a minimum of $ 5.8 billion, although its participation will decline over the next five years. Disney agreed to limit Hulu's capital injections to $ 1.5 billion a year and said any need beyond that would be debt-financed.
Beginning in January 2024, Comcast may require Disney to buy back its stake in Hulu and Disney may require NBCUniversal to sell that interest to Disney for its fair market value at that time.
As part of its programming, Hulu offers programs that are currently broadcast on NBC, such as "This is Us" and "Brooklyn Nine-Nine", soon after being broadcast on television. It also offers rebroadcasts of older shows from the NBCUniversal library.
The deal is structured to continue NBC's streaming ambitions.
As part of the deal, NBC has negotiated the right to show Hulu almost everything it licensed to its own streaming service, which will debut next year, meaning that the services will share these programs. The only exceptions are the three original series that NBCUniversal has produced for Hulu – "The Act", "The Past" and "Difficult People". They will only stay on Hulu.
(Updates with programming details beginning in the third paragraph.)
To contact the reporters on this story: Gerry Smith in New York at [email protected]; Lucas Shaw in Los Angeles at [email protected]
To contact the editors in charge of this story: Nick Turner at [email protected], John J. Edwards III, Cecile Daurat
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