Disney to acquire all of Hulu, heralding more mergers, higher prices

Acquiring Hulu gives Disney a high-quality streaming service aimed at adults, as opposed to Disney Plus, which primarily carries children’s content. The plan for the move was wrapped into Disney’s acquisition several years ago of 20th Century Fox. Disney faced a deadline to acquire its remaining stake of Hulu from Comcast, or sell it.

Consumers won’t see any immediate changes. They will continue to have the option to bundle Hulu with Disney Plus (and also ESPN Plus if they wish). However, “One could see it as a sign of the times as more and more media companies look at merging and consolidating,” said Tom Nunan, a former network television executive and a lecturer at the UCLA School of Film, Theater and Television.

The move comes amid a period of nearly unprecedented uncertainty in the entertainment industry. Actors have been out on strike for well over 100 days, although signs are pointing to a resolution. A months-long writers strike recently wrapped up. Meanwhile, the aftermath of so-called “peak TV” and the public’s changed viewing habits continue to reverberate.

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Some 600 shows aired on TV this year. Estimates for next year range as low as half that many. The result is consumers will be paying more for less.

“Just about everyone’s announced price increases recently … that is the future,” said Richard Rushfield, a longtime Hollywood observer and editor of an industry newsletter. “The big question mark hanging over everything is consolidation,” with some of the legacy studios in difficult straits even as tech companies such as Apple have the cash to purchase them if they wanted to.

The move by Disney is also seen as another sign that chief executive Bob Iger is in acquisition mode, Nunan said, after comments he made this year about restructuring and expanding Disney theme parks.

“This announcement along with the parks announcement feels like vintage Iger. He’s a spender — he doesn’t pull back,” Nunan said. “Contracting is off-brand for Iger.”

Walt Disney stock moved slightly upward on the news.