• by Wayne Friedman , Staff Writer, April 28, 2023

The coming deadline for Hulu permits either Disney or Comcast to force a sale of Comcast's remaining stake in Hulu to Disney starting from January 2024. But it may not stop there.

While there has been speculation that Disney might be interested in selling its stake in the premium streaming service, it's possible that Comcast -- now a passive owner of equity in Hulu -- might not be an ultimate buyer.

Why? Consider Comcast/NBCU's Peacock, which has its own issues with regard to growing scale --  with increasing subscribers -- while it has done well in increasing subscribers by 60% year-over-year to 22 million. All this is still way behind Netflix and or Amazon, which have 70 million or more subscribers, according to estimates.

If NBCUniversal was able to get to those levels, it could --  via its NBCU advertising sales machine -- offer up a big alternative to dramatically improve ad revenues on Peacock. Still, it would need to drive business  -- subscriber growth -- through more high profile streaming TV and movie content.

And that will mean continuing losses -- now estimated to be around $3 billion for the full 2023 year.

However, if it can sell its stake in Hulu -- to Disney or someone else desperately trying to improve its CTV/streaming portfolio -- that money could go to content spend and/or lowering losses.

Craig Moffett, senior research analyst at MoffettNathanson Research, on Thursday said: “It could be that Comcast's non-EBITDA producing assets – mostly notably, their stake in Hulu, but also their spectrum and venture holdings – are getting a closer look. This is not unreasonable either, given the now looming deadline for the Hulu deal. Recent leadership changes at NBCU arguably make a Hulu sale (as opposed to a Hulu buy) all the more likely.”

That's right. Disney's company-wide layoffs of 7,000 include Hulu as well as ESPN and other areas. That may make it more attractive to other parties.

At the same time, Hulu sits in No Man's Land to some. 

Here's why: Currently some legacy media TV companies are considering the idea of more advertising-supported channels -- but not platforms that cost a lot of money to start and or operate.

Those are the FAST channels -- those free, ad-supported TV platforms like Tubi (owned by Fox Corp) and Pluto TV (Paramount Global) which run inexpensive library movie and TV content. 

Hulu is also an advertising-supported channel -- a big one currently. But it still has a subscription fee and spends big money on premium original content.

So that means while it isn't a Tubi or Pluto, it also isn’t a subscription, ad-free behemoths like those options coming from Netflix, Disney+, or Prime Video.

No Man's Land? Maybe a sale is the right move.