Comcast CEO: Sale of Hulu to Disney ‘More Likely Than Not,’ But Devil Still Lies in the Details
Those following the back-and-forth between Disney and Comcast over the potential sale of Comcast’s 33% stake in Hulu can be forgiven for finding the proceedings a bit exhausting at this point. The two companies have been sparring for months over the subject, even before current Disney CEO Bob Iger was reinstated to the top job following the ouster of Bob Chapek.
But the past few weeks have given analysts and observers reason to hope that a resolution might actually be nearing. Those hopes were raised even further on Tuesday as Comcast CEO Brian Roberts, speaking at the MoffettNathanson Technology, Media and Telecom Conference in New York, said he still foresaw Disney purchasing Comcast’s stake in Hulu.
“I think it’s more likely than not,” Roberts said of a potential sale. “I think Disney recognizes, as anybody else would recognize it that Hulu is really valuable.”
Roberts also referenced last week’s conference call between Iger and Wall Street analysts to discuss Disney’s quarterly earnings report. In the call, Iger said that comments he'd made that seemed to distance the company from general entertainment in February were a bit hasty and that general entertainment was still in Disney’s plans going forward.
Iger also revealed his plans to make Disney+ and Hulu a “one-app experience” during the earnings call, which was the strongest indication since he was reinstalled as CEO that Disney still planned to buy the outstanding 33% of Hulu from Comcast. Disney likely cannot fully merge the libraries of the two streamers into a single app until it has full control of Hulu, but this intermediate step shows the strong likelihood of that eventuality.
Roberts also discussed what he thought was a fair way to determine the value of Comcast’s portion of Hulu. An independent valuation from 2019, when Disney acquired Fox’s share of Hulu along with the majority of its entertainment assets, put the company’s worth at $27.5 billion. That means Disney must pay at least $9.17 billion to get the rest of Hulu from Comcast, but Roberts echoed comments he has made in the past about how much more the streamer would be worth if it were up for sale to all bidders.
“What would a willing buyer in a robust auction pay?” he asked rhetorically. “It’s sort of a hypothetical question because you also not only get a 50 million, 55 million plus domestic [subscribers] streaming service. There’s never been one for sale. And in the hypothetical that the appraisal process imagined when we structured the relationship, you get all the content from Disney and Fox with it forever. And so what’s that worth to any buyer — including Disney, or including Comcast, or including other tech companies or whomever — if it was actually for sale in that way?”
Roberts may be overstating his case a bit because, while Disney did acquire many titles from the Fox catalog, Hulu is still primarily a streaming service focused on the next-day rights to broadcast and cable series, and the service does not own the rights to next-day streams of Fox primetime shows “forever.” However, the two companies did agree to extend the licensing deal between them in January, which means that Fox shows will stream on Hulu the day after they air on TV for multiple years to come.
Hulu began its life as a jointly-operated streaming platform that was owned in equal pieces by Disney, Comcast and Fox. When Fox’s portion was acquired by Disney in 2019, it also agreed to purchase Comcast’s stake in Hulu by the end of 2024. Whether Disney has ever truly wavered from that intention, or whether Iger’s comments that his company was open to selling the majority of Hulu were simply intended to drive down the price may never be known. But it is increasingly looking like Disney will execute the purchase as planned, if it can agree to a price with Comcast.
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Hulu is a video streaming service that gives access to thousands of full seasons of exclusive series, hit movies, kids shows, and Hulu Originals like “Only Murders in the Building,” and “The Handmaid’s Tale.”