Hulu keeps NBC shows even as Disney takes control from Comcast

Bessie Dean
May 15, 2019

The contract takes away voting rights from the board members representing Comcast subsidiary NBCUniversal, which owns a 33% share in Hulu, and effectively gives the only other stakeholder, Disney, full operational control of the service. Comcast ultimately gets at least $5.8 billion for its stake in Hulu, per their agreement.

Fortunately for Hulu subscribers, NBCUniversal has already agreed to extend their Hulu license of NBCU content and the contract for Hulu's live TV service with NBCU channels until late 2024, so this content will remain safely on Hulu for the time being.

While Comcast has agreed to keep its NBCUniversal shows and networks on Hulu until late 2024, it can cut much of that deal off early, moving shows to its own streaming service in three years.

Disney CEO Bob Iger discussed the Hulu news this morning at MoffettNathanson's Media & Communications Summit. Right now, Hulu carries a lot of NBC shows, including "Saturday Night Live", "The Voice" and "The Good Place". In November 2018 Disney said in a regulatory filing that Hulu was worth about $9.3 billion, but AT&T's recent sale of its Hulu stake raised the company's implied valuation to $15 billion.

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The other perks of the deal for Comcast NBCUniversal include both the ability to cancel content-licensing deals with Hulu by 2022, but more importantly, any Hulu-exclusive deals can be canceled within one year. A Disney executive said that the deal will be "effective immediately", and in the coming weeks, the company plans to finalize its deal with Comcast to become the sole owner of the SVOD service.

Hulu´s US user base trails that of Netflix, which has some 60 million United States subscribers, but it has grown faster than its larger rival so far in 2019. By the same token, Disney can require NBCUniversal to sell that interest to Disney for its fair market value at that time, the companies announced Tuesday. However, Comcast can require Disney to purchase NBCU's interest in Hulu beginning as early as January 2024. Comcast is planning to launch its own streaming service under the NBCUniversal brand next year. It will also see Comcast offer Hulu on Xfinity X1.

With Disney now wielding full operational control over Hulu, it's unclear how the Hulu and Disney+ symbiosis will play out.

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