It’s finally happening. After seemingly endless waiting, teasing, and more “will-they-won’t-they” than a tropey sitcom, Disney and Comcast have finally agreed to move forward with the contractual opportunity which will allow Disney to purchase Comcast’s 33% stake in Hulu, uniting the streamer under one corporate banner.

• The announcement of Disney and Comcast’s agreement came late Wednesday afternoon.
• Disney is expected to merge Hulu and Disney+ into a single app, though both will be available separately.
• Disney’s quest for streaming profitability may drive it to force customers to purchase the two streamers together or not at all.

What Are the Terms of the Hulu Sale?

The terms agreed to by Disney and Comcast are a little different than what’s been discussed publicly for months. Disney will pay at least $8.61 billion, one-third of the $27.5 billion minimum valuation the two companies agreed upon in 2019 minus “anticipated outstanding capital call contributions payable by NBCU to Disney.”

Each firm has hired an investment banker to value Hulu objectively, If those two valuations are more than 10% apart, a third firm will be brought in to make its own valuation. Hulu’s final worth will then be calculated by taking an average of the two numbers that are closest to each other.

What Does the Deal Mean for the Future of Disney+ and Hulu?

In the short term, the deal means that Disney can execute its plans to bring Disney+ and Hulu together on a single app by the end of this year. But what will that look like? Reports indicate that initially, there will be a Hulu tile within Disney+ that takes users to that content.

The entire Hulu library won’t be available within the new app immediately, which means that Hulu won’t simply disappear as a standalone option. However, given the redundancies having two entertainment streaming apps will create for Disney, it would hardly be surprising to see it stop offering a separate Hulu app in the future.

Remember, this was initially the plan Warner Bros. Discovery had in mind for discovery+ when that streamer’s content was combined with HBO Max to create Max. But a few months before Max’s launch, WBD changed course, giving the rationale that discovery+’s low churn rate and lower monthly price gave it a reason to keep the streamer a separate entity.

But Hulu doesn’t distinguish itself from Disney+ in terms of price. Hulu and Disney+’s ad-supported tiers are the same price, and ad-free Hulu is actually more expensive than Disney+ by $4 per month. The future of Disney+ could well be that it is the only entertainment streaming offering Disney has, and users may well be forced to choose between taking both Disney+ and Hulu’s content, or not taking anything.

Internationally, however, Hulu could remain a standalone product for much longer. Disney has held off on an international launch of Hulu, likely to keep its valuation from going up while it negotiated with Comcast. Now, global users should expect Hulu within months of the final closing of the Disney-Comcast deal.

After months of feeling like there might never be any movement on the Hulu deal, there is finally tangible progress. Disney’s purchase of Hulu will soon be complete, and when that happens it will cause big changes for both Hulu and Disney+.