Disney and Comcast clash over Hulu valuation, raising specter of legal battle

Negotiations between Disney and Comcast over the future of Hulu, the popular streaming platform, have reportedly reached an impasse, according to a Wall Street Journal report. The sticking point appears to be a significant disagreement over the valuation of Hulu, raising the possibility of a legal battle.

A buyout on the table

The talks center on Disney acquiring Comcast’s remaining stake in Hulu. Disney currently owns 67% of the platform, with Comcast holding the remaining 33%. This potential buyout would give Disney full control of Hulu, aligning with the company’s broader strategy of consolidating its streaming portfolio under the Disney+ banner.

Valuation gap hinders deal

However, the two media giants are reportedly far apart on the value of Hulu. Details of the specific figures are not public, but the significant disagreement suggests a potentially wide valuation gap. Each side hired banks to appraise Hulu’s total value. According to the WSJ, Comcast’s side has it at over $40 billion, while Disney’s estimation stands at approximately $27,5 billion, the floor price the two sides had set under a pact they struck several years ago. This disconnect could derail negotiations and push both companies towards litigation to determine a fair price.

Impact on streaming landscape

Hulu boasts over 50 million subscribers and offers a diverse library of content, making it a valuable asset in the ever-crowded streaming landscape. Comcast’s NBCUniversal, meanwhile, is focused on its own streaming service Peacock, which had 34 million subscribers as of the March quarter. 

Looking ahead

Both Disney and Comcast are likely to face pressure to reach a resolution. A court battle would be costly and time-consuming for both companies. Whether the two sides can bridge the valuation gap and reach an agreement, or if Hulu becomes the subject of a legal dispute, remains to be seen.