Don’t get too attached to Hulu. It may not be around in the way you know it a year from now. What was four has now become two. AT&T has sold its 9.5% share in Hulu back to Hulu. The transaction valued Hulu at $15 billion, with AT&T’s 9.5% interest worth $1.43 billion, according to Deadline. While some people may be surprised by this move, it actually makes a lot of sense.
Last year, AT&T purchased Time Warner. Since then, AT&T has decided that it wants to have more money for itself and is working on their own streaming service, WarnerMedia. AT&T has two goals in mind: pay down their debt and develop the streaming service. AT&T seems to be having legal issues with shareholders filing lawsuits claiming AT&T falsely claimed DirecTV and DirecTV Now were in a better position than they actually are.
“The complaint accuses AT&T and executives including CEO Randall Stephenson of violating the US Securities Act by “knowingly or recklessly” making false statements to investors and failing to disclose problems that were affecting DirecTV Now sales,” Ars Technica reported. So, AT&T needs to make this deal work. However, their ace in the hold is all the channels and shows they acquired from the deal, as well as a huge built-in library. However, knowing AT&T, they will charge themselves out of the market to make any money.
“If Comcast follows suit, it could leave Hulu as an exclusively Disney service that compliments the upcoming $7-a-month Disney+,” according to The Verge. “Disney has even hinted as much, with the company highlighting in the past few days the different roles it intends for Hulu and Disney+, with Hulu offering more mature content, and even the potential for a joint bundle.”
Which is something I referred to on this week’s The Lazy Geeks. During our discussion on streaming services, I mentioned that Hulu could become the more “mature arm” of Disney+. For those of you old enough, you may remember studios like Hollywood Pictures or Touchstone Pictures. Those were arms of Disney that would release more adult fare. The Rock was essentially a Disney production, which gave Michael Bay his high-octane career.
There were four studios that came together to combat piracy of their content. This joint venture formed Hulu. Allowing a legal way for people to view their current content online. However, their limitations are so vast that it pales in comparison to Netflix or even some of their on-demand streaming apps. When Disney purchased Fox, they absorbed their share of Hulu and became majority owner. AT&T sold their share back to the company, and it will be divided between the two.
Now, Comcast could decide that it would leave Hulu, thus leaving Disney in full control. Comcast own NBC, which gives them a large library of new and old content. Not to mention they own Universal, as well. One thing Universal does well, is that it never sells its rights to anything, which is why there will never be a solo Hulk movie with Marvel.
In the end, Hulu may be the shadow of its former self in a year. However, AT&T’s streaming service could hurt them more than anyone else. Warner Bros. does have some name power, but many people will clamor more for Disney or Netflix content than reruns of CW shows. Yeah, they will have The Flash, Supernatural, and most importantly Friends. Hulu can go either way at this point, but I see it only getting more content, especially if Disney gains sole control of it.