In a historic move, Disney has announced a deal to acquire Comcast’s stake in Hulu for $8.6 billion. This decision is part of CEO Bob Iger’s ongoing strategy to reshape Disney’s focus around streaming. The move highlights Disney’s commitment to creating a unified streaming app that will incorporate Hulu’s general entertainment content into Disney+.
The acquisition process marks another milestone in Hulu’s journey. Beginning as one of the first streaming services to run advertisements, Hulu was established in 2007 alongside competitors like YouTube. Through the years, it has sustained and thrived, offering a variety of content, from popular dramas such as “The Handmaid’s Tale”, to comedy hits like “Only Murders in the Building”.
The road to the acquisition has been the subject of much speculation, particularly as Bob Iger initially considered the possibility of divesting Hulu. However, the company’s recent shift towards valuing general entertainment content, combined with the success of Disney+, has led to a change in direction.
The future of Disney in relation to the acquisition rests on determining the final cost of Hulu. An agreement between Disney and Comcast placed the minimum valuation of Hulu at $27.5 billion. Analysts have suggested a starting point at $35 billion for valuing Hulu. However, amidst these uncertainties, it is clear that fully owning Hulu holds the potential to support Disney’s streaming strategy and solidify its position within the competitive streaming market.
As the market continues to consolidate in favor of a few major streamers, Disney is positioning itself to utilize the benefits of owning Hulu within its streaming business. Supporting its ambition for streaming profitability, Disney is gearing up for the launch of a combined Hulu-Disney+ app. This consolidated approach could lead to a significant increase in ad revenue and further position Disney to compete with streaming giants like Netflix.
In a move towards solidifying its streaming business, Disney, along with competitors, is raising prices and relying on advertisements. With the vast investment in content, Disney is set to position itself as a significant contender in the streaming market, securing its place as a major player alongside Netflix.
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