Disney Said to Be in Discussion for WarnerMedia's Share of Hulu
The Walt Disney Company currently owns 30% of Hulu, but it might soon own 70%. It will take on 21st Century Fox's 30% share when it completes its acquisition of that company, and it's reportedly in talks to buy the 10% owned by AT&T/WarnerMedia.
According to an unconfirmed report from Variety, WarnerMedia is looking to sell its share of Hulu since it will launch its own streaming service later this year. The company sees Hulu as an asset it can liquidate to raise working capital.
Disney has its own streaming service launching soon, Disney+, but having two online outlets gives it a strategic way to use all the content coming from its many studios: Family-friendly fare will go to Disney+ while movies and shows for a more adult audience will go to Hulu.
The remaining 30% of Hulu is owned by Comcast, and that company doesn't seem interested in selling. “Disney would like to buy us out,” Steve Burke, CEO of NBCUniversal, told Variety. “I don’t think anything’s going to happen in the near term.”
Hulu announced in January that it ended the year with 25 million subscribers. It didn't break down how many subscribe to its VOD offering and how many go for the live channels.
Yesterday's Walt Disney earning call was the first to spotlight the company's direct-to-consumer segment, showing deep investments in Disney+.
The new format will show an overlay ad over part of the screen when a program is paused, and is currently in beta testing.
A recent price hike by Netflix could have consumers reevaluating their OTT spending. By lowering costs, Hulu helps avoid churn.