Following the acquisition of 20th Century Fox and its assets, The Walt Disney Company took a majority stake in Hulu with 67% ownership over the streaming service.
By establishing an expiration date of five years from now, Comcast is betting the value of its stake will appreciate significantly as Disney prepares unencumbered to expand the scope and reach of Hulu in the domestic and global markets to battle the likes of Netflix, Amazon.com Inc and Apple Inc.
The Hulu deal also comes as Disney is embarking on an ambitious streaming initiative.
Disney said Tuesday it has struck a deal with cable provider Comcast that gives the entertainment company control of streaming service Hulu. In exchange, Comcast can require Disney to buy NBCUniversal's 33 percent ownership interest in Hulu, as early as January 2024. Hulu's fair market value will be assessed at the time of that future sale, but Disney guaranteed a minimum sale price of $27.5 billion.
At the same time, Comcast's NBCUniversal will have the right to cancel most of its content-licensing agreements with Hulu by 2022 - while it will have the right to pull back NBCU programming previously licensed exclusively to Hulu within one year (continuing to make it available to Hulu on a nonexclusive basis). Amazon's Matthew Ball notes that Comcast gets an $8 billion check out of this deal, though that's after billions lost in investment in Hulu, which lost $1.5 billion this year and reportedly won't become profitable until 2024 - that is, according to Disney. Last month, Disney detailed its plans for Disney Plus, which is meant to be Disney's family-friend companion service to its offering of Hulu as the home for more adult-oriented fare.
The Disney takeover continues. All hail our corporate overlords.