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Disney Takes Over Hulu, Effective Immediately

Comcast will hold an ownership stake in the company until 2024, but Bob Iger is now the man in charge.

Dave Hollis The Walt Disney Studios Presentation, CinemaCon, Las Vegas, USA - 24 Apr 2018

Rob Latour/REX/Shutterstock

UPDATE: As a part of its Tuesday, May 14 upfront presentation, Disney revealed that it will assume operational control of Hulu effective immediately, leading to the eventual sale of Comcast’s ownership stake in the company to Disney in 2024. In three years’ time, NBCUniversal can terminate most of its content license agreements with Hulu, and a year from now, NBCUniversal will also have the ability to stream content it licenses exclusively to Hulu on its own OTT service.

ORIGINAL STORY: Coming this fall, Disney will be after a large chunk of the global viewing audience with the release of its new mammoth streaming platform. But in addition to Disney+, the company reportedly has its eye on taking even more control over one of its competitors.

CNBC details new developments in the ongoing question of Hulu control, citing a source that says Comcast is considering selling its 30 percent stake in the streaming platform to Disney. Following its recent acquisition of 20th Century Fox’s holdings, Disney already has a 60 percent share in ownership. The 9.5 percent of the company that Hulu recently reacquired from AT&T would be split among Disney and Comcast as it stands now; Disney would get that amount in is entirety as part of a broader purchase from Comcast.

A number of factors go into determining Comcast’s ultimate decision, including the communications giant’s current standing as owner of NBC. While NBC programs do appear on other streaming services (see: “The Good Place” on Netflix), Hulu is currently the primary home for NBC programming the day after its linear premiere.

The impending arrival of Disney+ presents a strategic calculation, but this deal would also likely hinge on the economic viability of not just Hulu as an individual platform, but the health of the streaming video industry overall. At the close of 2018, Hulu’s own estimates put its subscriber base at over 25 million users.

Even before the Fox acquisition, Disney chief Bob Iger outlined a potential strategy that would use Hulu as the company’s home for programming that wasn’t as family friendly.

“There’s a lot of Fox intellectual property that fits extremely well into Disney-branded direct-to-consumer services,” Iger said in late 2017. “There’s a lot of product that we believe will be of great use to growing Hulu as it already is. Hulu is a more adult-oriented product [that will benefit from] Fox television production and FX.”

Comcast reported its Q1 2019 earnings this morning, reporting revenue of $26.86 billion, missing analysts’ expectations of $27.2 billion, according to CNBC. The company attributed the miss to a difficult year-over-year comparison between Q1 2018 results which included revenue from the Olympics and the Super Bowl. The company’s stock was up 3.15 percent at mid-day.

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