Home Business Streaming Service Hulu Buys Out AT&T Stake for $1.43 Billion

Streaming Service Hulu Buys Out AT&T Stake for $1.43 Billion

by Jennifer Smith
business

Streaming service Hulu has grown in popularity ever since it was first established as a joint venture between Disney and Comcast back in 2007. Eventually, many investors came on board as the service grew and more subscribers came into the fold and one of the key investors during these period has been American telecom giant AT&T, which held a 10% stake in the company. However, in a new development, Hulu has bought out AT&T’s stake in the business for a staggering $1.43 billion. Following the completion of this deal, the streaming service is now being valued at $15 billion. The whole thing unfolded pretty quickly over the past year as Disney acquired Rupert Murdoch’s Fox in a path-breaking deal last year and ended up owning the stake owned by Fox as well.

At the time, Disney, Comcast and Fox all owned 30% of the company, and the rest of the company was owned by AT&T. After getting hold of Fox’s stake, Disney quickly became the largest shareholder in the company, and after Hulu’s buy out of AT&T’s stake, Disney is now the biggest shareholder in the streaming service. Its stake now stands at 66% and needless to say, it is now the power behind the company.

Time Warner had bought the stake in Hulu back in 2016 when streaming services exploded, and before long that stake passed on to AT&T, once the former was acquired by the latter. However, AT&T is all set to launch its very own streaming services and needless to say, they had to sell its stake in Hulu. Randy Freer, the CEO of Hulu stated that Warner Media will continue to be a ‘valued partner’ in the years to come. He said,

“WarnerMedia will remain a valued partner to Hulu for years to come as we offer customers the best of TV, live and on demand, all in one place.”

The current stake of Disney in the company is also an indication that perhaps Hulu’s programming is now going to be significantly lopsided towards content produced California based media behemoth and it remains to be seen what happens in the coming months. In this situation, there is also a case for Comcast to sell its 33% stake in Hulu to Disney and get away from an unequal partnership. If that happens, then Disney will be the sole owner of a service that had originally started as a joint venture.

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