Disney takes over full control of Hulu

The Hulu logo on a window at the Milk Studios space in New York. (Dan Goodman/AP)

Disney has made a deal with Comcast to take over operational control of Hulu, giving it full oversight of the streaming platform.

The agreement puts Hulu under the control and guidance of a single company for the first time.

The deal, which was expected, will allow for Comcast to retain its 33 percent financial stake in Hulu for the next five years even as Disney has operational carte blanche.

In 2024, either side will be able to force a change: Disney can compel Comcast to sell its stake while Comcast can require Disney to buy it, at a minimum valuation of $27.5 billion for the entire company.

Under terms of the agreement, Comcast must continue to license NBCUniversal content to the service until 2024, while Disney by the middle of 2020 must allow some previously Hulu-exclusive content to be streamed on Comcast’s own planned streaming platform.

Hulu had previously seen ownership split evenly among Disney, Fox and NBCUniversal, with an additional 10 percent owned by Warner Media. Disney took Fox’s stake in the acquisition of the Rupert Murdoch assets and bought out WarnerMedia’s piece last month for $1.4 billion.

The deal further ramps up a rivalry with Netflix, which is growing its in-house studio and fighting to hold on to some of its most popular shows and movies produced by other content providers as they launch their own streaming services.

At a news conference in New York ahead of Disney’s annual presentation to advertisers, ABC Entertainment President Karey Burke called the Hulu news a “big day for our company and very exciting for content creators and viewers.” But she said she didn’t know yet how many, or which, ABC shows will live there vs. Disney+.

“Specifically how that will roll out and what that relationship will be there I just don’t know yet,” she said.

Disney’s chairman and chief executive Robert A. Iger said in a statement that Hulu’s portfolio of original content and its library of serials, movies and live TV offerings means the company “represents the best of television.”

“We are now able to completely integrate Hulu into our direct-to-consumer business and leverage the full power of The Walt Disney Company’s brands and creative engines to make the service even more compelling and a greater value for consumers,” he said.

Disney’s stock was up 1.6 percent after the announcement. Comcast’s stock was up about 1.7 percent.

Steven Zeitchik contributed reporting from New York.