Walt Disney will take full control of American streaming service Hulu from co-owner Comcast in a deal. The deal might boost Hulu’s worth to more than $27 billion in the next five years. According to the two companies, Comcast which owns a third of Hulu can sell its stake to Disney from 2024 onward for a minimum of $5.8 billion. However, for now, Comcast will be a silent investor.
Disney expects Hulu to have nearly 60 million subscribers by 2024, an increase from 25 million last year. This, in part, will be possible through new advertising features and several new shows, including the two new Marvel Comics characters. That said, Disney will also pull its movies from Netflix and start its own streaming services Disney+ launching in November. The deal will be leaving Hulu to run under a single brand, marking the end of Disney-Comcast’s complicated co-ownership in entertainment, Yahoo reports.
Disney Chief Executive Officer Bob Iger said in a statement, “We are now able to completely integrate Hulu into our direct-to-consumer business.” Investors in both companies seemed thrilled with the decision. But the decision does not come as a surprise because Disney had acquired the majority control of Hulu by buying Fox’s stake as part of its purchase of Fox’s entertainment business this year.
Chairman of FX Network John Phillip Landgraf, said, “I don’t see FX in Disney+ at all.” Disney shares rose 2.1 percent and Comcast gained as much as 2.3 percent.
A month ago, Hulu was valued at $15 billion. But with Netflix’s market capitalisation of $152 billion which is 10 times more than Hulu’s, Disney will have to come up with new streaming strategies. The Washington Post said that the decision comes at a time when both companies prepare to launch their own streaming services as a result of limited audiences for television and Netflix’s growing popularity.
Media analyst Geetha Ranganathan, said, “The move enables an international launch for the service. Disney expects Hulu will reach 40-60 million domestic subscribers in five years, suggesting 150 million global customers, based on a 33% domestic split.”
Currently, Hulu airs its shows on the National Broadcasting Company (NBC).