BURBANK, CA – Disney has officially acquired full ownership of Hulu, concluding a nearly two-decade journey that began as a joint venture with NBC and Fox.
Immediate Impact of Disney’s Hulu Acquisition
Disney completed the buyout by paying an additional $438.7 million to Comcast’s NBCUniversal. This payment comes on top of the $8.6 billion Disney committed in 2023 under a put/call arrangement outlined in 2019. The acquisition marks a significant milestone in Disney’s streaming strategy.
The transaction, finalized on Monday, incorporates the valuation of a third-party appraiser. Had NBCUniversal’s higher appraisal been accepted, Disney would have owed approximately $5 billion to Comcast, according to a filing with the SEC.
Key Details Emerge from the Agreement
Disney’s purchase of Hulu follows its $71.3 billion acquisition of most of 21st Century Fox, a move that significantly bolstered its streaming ambitions ahead of the Disney+ launch. While Disney had maintained operational control of Hulu, Comcast retained a one-third financial stake pending the final valuation.
Disney’s appraisal valued Hulu below the $27.5 billion floor, while NBCUniversal’s estimate was “substantially” higher.
Disney CEO Bob Iger expressed satisfaction with the resolution, stating, “Completing the Hulu acquisition paves the way for a deeper and more seamless integration of Hulu’s general entertainment content with Disney+ and ESPN’s direct-to-consumer product.”
Industry Response to the Buyout
Comcast acknowledged the conclusion of their streaming venture, stating, “Hulu was a great start for us in streaming that generated nearly $10 billion in proceeds for Comcast and created an important audience for NBCUniversal’s world-class content.”
The buyout is expected to close by July 24, further integrating Hulu with Disney’s existing streaming platforms and linear networks.
Background Context on Hulu’s Evolution
Hulu’s journey began in the pre-smartphone era, with NBC and Fox as initial partners. Disney joined soon after, and Time Warner acquired a 10% stake. Despite internal conflicts and shifting strategies, Hulu’s collaborative model is now seen as a precursor to current media alliances grappling with streaming’s challenges.
Hulu’s inception in 2007 set the stage for today’s streaming landscape, highlighting the need for legacy media collaboration.
What Comes Next for Disney and Hulu
With full ownership, Disney is poised to enhance Hulu’s integration with its other services, offering consumers a comprehensive entertainment package. The move represents a strategic shift as Disney aims to solidify its position in the competitive streaming market.
As the media landscape continues to evolve, industry experts suggest that Disney’s acquisition of Hulu could serve as a model for future mergers and partnerships.
The timing of this acquisition is particularly significant as media giants navigate the complexities of streaming versus traditional pay-TV models, seeking to maximize both content reach and profitability.
