Welcome to Tech Stuff, a production from iHeartRadio. Hey there, and welcome to tech Stuff. I'm your host, Jonathan Strickland. I'm an executive producer with iHeart Podcasts and how the tech are you? So? In our last episode, I covered the origins of Hulu, the streaming service that started off as a joint venture between NBC Universal and News Corp, two competing media companies. So we got up to twenty thirteen, which was a tumultuous year for Hulu. Jason Kayler, the original CEO for Hulu, the guy who really helped shape what Hulu would become, left the company. His interim replacement would also leave before the year was over. Mike Hopkins, who became the new CEO, had formerly been an executive at Fox Networks Group, and so he came from the news course of the business. Other changes had also happened by that point, right, So Disney joined newscre at NBC Universal and became a joint stakeholder in Hulu. This meant that three of the four broadcast companies in the United States were stakeholders. You had ABC, which was owned by Disney, you had Fox, which was owned by News Corp. And Obviously, NBC Universal had NBC, so CBS was the only holdout. Also, Comcast would acquire NBC Universal, which in itself is a very complicated story. Comcasts first announced this deal in late two thousand and nine. The initial part of this acquisition concluded in twenty eleven after a lot but arguably not enough scrutiny from regulators. But Comcast wouldn't get full ownership of NBC Universal until General Electric divested its remaining stake in the company in twenty thirteen. These things are super complicated, but that's pretty much par for the course for media companies. If you look back over the corporate ownership history of any major media company that's been around for at least a decade, it gets messy. Anyway, Comcast becoming the new corporate daddy to NBC Universal is why we will later be talking about a showdown between Disney and Comcast toward the end of this episode. Another big change also happened in twenty thirteen that would impact the future of Hulu. On June twenty eighth of that year, news Core, which was the media empire of Rupert Murdoch, split in Twain. That is, newscrep would become two separate companies. Now, one of those companies, twenty first century Fox, would include the famous twentieth century Fox film studio, the Fox Television Networks, and a stake in National Geographic Newscrep would be the publishing arm of the company. As part of this divestment, Newscrep transferred its stake in hul to twenty first century Fox. Now this is the reason we don't have to talk about Disney, Comcast and newscre at the end of this episode, because, as I'm sure most of you are aware, Disney subsequently gobbled up twenty first century Fox in twenty nineteen, which means Disney slice of Hulu's high would just get bigger and bigger. But I'm getting ahead of myself, so Hulu was also changing outside of these big corporate maneuvers. The initial business model of Hulu was to offer up ads supported viewing of recent television episodes. So as a user, originally you would go to the Hulu website, so you'd use a laptop or desktop PC and navigate to the Hulu website. Keep in mind, this is when smartphones are a brand new thing, so using a smartphone to navigate the web was still very new when Hulu launched officially in two thousand and eight. So you would use a PC or laptop to go to Hulu's website and you could watch a few of the most recent episodes of various television programs that were provided by content partners. Typically, you could view the episode that had most recently aired on TV anytime between the following day up to the following month. It all depended upon the actual agreement between the studio and Hulu. We'll talk about that again in a bit. You did not have access to the back catalog of episodes of any show, didn't matter what network it was on. You might be able to watch the most recent five episodes, and then on top of that, you could potentially have access to around half a dozen other episodes from across the entire history of a show, but you would have no control over which episodes those would be. So maybe you'd know for a show that had lots and lots of seasons, like ten or more seasons, you might have a couple of episodes from season four, and then maybe a couple from season six or whatever, but they wouldn't necessarily connect to each other and wouldn't be able to say which ones you got to see. Now, just a little bit more backtracking before we continue on with our story, because there's some elements that I did not mention in the last episode. In twenty ten, Hulu had introduced Hulu Plus, a subscription based service that let audiences access an entire season the most recent season of episodes for shows. So you could get access to a full season of episodes, not the entire history, but at least the most recent season if you were a subscriber, and it costs seven dollars ninety nine cents per month. Now I believe that on Monday's episode, I said nine dollars ninety nine cents. That's because I was pulling that from other sources. And to be fair, Hulu has changed its pricing throughout its history, but the actual initial price when it launched was seven dollars ninety nine cents per month. This service was also ad supported, so customers still had to go through some ads in order to do this. So you're paying you know, essentially eight bucks a month, but you also still get ads. So analysts were predicting that this subscription model was going to fail because who the heck was going to pay to access television programming that otherwise they could get for free, although you didn't really get it for free. You got in return for whatever your cable or satellite package was, unless you were actually using antenna to pick up over the air broadcast. Well, it turned out that Hulu's method worked pretty well. It did not go down in flames as the analysts were predicting. In twenty eleven, the service boasted it had hit a million subscribers, and Kyler said that the service would bring in around two hundred million dollars after it had been launched for a year, the subscription service, that is, and that's a lot of money. But then Hulu was also spending a lot of money securing content partners, right because it wasn't just ABC and Fox and NBC that was providing content to Hulu. Hulu was securing licenses with lots of different content partners out there, and that cost money. Cable networks and providers were growing concerned that Hulu was cannibalizing their audiences, and there was a lot of friction in the media space. So, for example, in twenty ten, newscre got into a serious tif with Cablevision, the cable provider these two companies were in a fundamental disagreement over retransmission fees. News Core was playing hardball and it ended up blocking Cablevision subscribers from accessing programming, and that included online programming. So if you were a Cablevision ISP customer and you tried to go to Fox dot com to watch Fox material, or if you tried to watch Fox material on Hulu, you would get blocked, which made a lot of people mad. And it really made people angry that they weren't able to access sports programming because the World Series of Baseball was coming up and Cablevision was trying to hold out from having to pay higher retransmission. This one battle really just encapsulates a much larger story of traditional media versus streaming media. And keep in mind, it's kind of funny because traditional media companies were the owners of the streaming service Hulu. So again, very complicated. Television had been king for decades, but the cord cutting trend was really emerging big time. It would only get worse down the line. Here's a fun side note. Around the same time, CNN reached out to me to comment on the trend of cord cutting. So I did I gave CNN some information about cord cutting and like the trends that were going on at the time and the reason for those trends. And I got a talking too, because at the time, the company I worked for, house stuff Works, was owned by Discovery Communications, a cable channel company cable network company, and Discovery did not like that I was talking about cord cutting, as if some how I was affecting cord cutting, as if I was responsible for it. I was commenting on something that was happening, whether I talked about it or not. And I'm pretty sure that I was not the reason A bunch of people suddenly said, you know what, You're right, it is time we stopped paying cable. So I still think it's funny that I was talked to about this and that it was a whole thing because I'm like, you guys are treating me like I'm way more important than I am, and if I am this important, you need to pay me more. Right. That's the lesson you learned, is that if I'm important enough to be a threat to your business, I'm important enough for you to pay me more money. Anyway, that was a tangent side note, doesn't really matter. The TV based businesses were desperately clinging onto a model that was just going out of style. Thus the talking to I got so my personal opinion is that the decline of broadcast and cable television was inevitable. That nothing that these companies did was going to stop that decline. It was just going to happen. So all they could really do is try and slow things down as much as they could, or to make things difficult on streaming platforms which were kind of in an investment and growth mode, or the traditional companies could try and create their own strategies to segue into the streaming model, the internet based model of delivering entertainment. A lot of those media companies resisted that, or they tried to buy up companies that were kind of already doing that and use that as their on ramp. Hulu itself was kind of an on ramp for that kind of thing. But because these streaming services were in investment and growth mode, it meant they were not focused on making a profit at this time. That was not the main goal of the early years of these services. They were trying to establish a large customer base and to scale as quickly as possible. This was really bad news for the cable industry because it meant that this new competitor was willing to operate at a loss. Right, They were not operating with fear of how it was going to affect their profits because they weren't profitable. They were operating at a way of gaining new customers. But the cable industry was looking at a shrinking customer base and angry shareholders. So they were in a very different situation, and it was a pretty volatile situation. We're technically still kind of in that situation, but at this point, I think most folks acknowledged that cable TV is seriously on the decline. In fact, you know, Kyler wrote an essay in twenty twenty three, the former CEO of Hulu wrote an essay in twenty twenty three that revealed, quote linear television declines at a rate of close to ten percent per year in the United States end quote. And further that quote, the median age for most entertainment shows was over sixty end quote. And that is the median age for linear television entertainment. So, if you've ever wondered why so many TV shows seem to cater to the elderly. That's why the elderly are the ones who are still watching television in the first place. Kyler also said that out of all the streaming platforms in twenty twenty three, and there were a ton of them at that point, only Netflix quote is generating material cash flow from streaming end quote. So Kyler wasn't saying that streaming was a doomed business model, and I'll try to come back and touch on that. I just really wanted to establish the setting that Hulu was part of an early wave of streaming services that were changing the way audiences access entertainment and ultimately how they would challenge the status quo. Okay, we're going to take a quick break. When we come back, we'll talk more about Hulu's evolution. We're back. So one thing that I failed to mention in the previous episode was that Hulu was broadening its access. So again, originally when Hulu launched, it was a website full stop. And keep in mind, like Hulu launched in two thousand and eight, so iPhone comes out in two thousand and seven, we don't really get the app store until two thousand and eight, so we wouldn't get into a glut of smartphone and mobile device apps for a couple more years. The app landscape was still kind of on the horizon when Hulu launched, so the one way you could access Hulu content was on a computer, though if you were willing to put in the work, you could technically use a television as a display and watch content on television that way, but that was kind of janky for most people. It was beyond the reach of a lot of folks. They would wait until there would be more integrated solutions, either with streaming boxes or with smart televisions or that kind of thing. So you couldn't watch Hulu on television in the early days. But a couple of years after launch, Hulu began to release apps and work with device manufacturers to make Hulu available through other devices, which would include smartphones and tablets and over the top services as well as like video game consoles and smart TVs. This wasn't straightforward, however, and the experience could really leave customers frustrated because Hulu still had to secure agreements with all the different content providers, of which there were many, so again, Hulu wasn't just serving up stuff that could be found on ABC NBC and Fox, and not everyone would agree to all the terms and they would require specific exceptions. So for some shows, viewers might be allowed to access an episode on any device running a Hulu app like it could be a computer, a smartphone, it could be or television, doesn't matter. But for other shows, viewers might only be restricted to the web browser version on a PC. So it would be weird because you could log into Hulu on your computer and watch a show like that, but if you were to pull up your Hulu app on a streaming service, like on a box connected to your television, that show would not be there, and that was really confusing. Also, shows would have different premiere dates on Hulu. Some episodes premiered the day after they aired on television, some eight days after they aired, so the following week. Some had a delay of thirty days, so like a full month. And this was all over the place, and it meant that using Hulu was confusing. This was not the fault of Hulu, but because the powerful studios could command these conditions, they were the ones that were dictating the terms. They felt incentivized to do this because they were, you know, they were playing in a new space. Even shows that aired on one of the stakeholder networks on ABC or Fox or NBC, they weren't immune to shenanigans either. So, for example, The New York Times reported that The Middle, which was an American sitcom that aired on ABC, which belonged to Disney, and Disney was a stakeholder, that show was not available on Hulu back in twenty eleven. But why I mean? Like I said, ABC was part of the major stakeholders in Hulu, so what gives? Well, while ABC would broadcast The Middle, the studio that actually made the show was Warner Brothers. So ABC had secured the rights to broadcast the show, but Warner Brothers made the show. Warner Brothers declined to have The Middle available on Hulu. As to why, well, we can only speculate, but chances are it was an effort to protect the show so that it could make more money when it was put into syndication, because syndication is a very lucrative market for first run shows. So chances are Warner Brothers didn't want to cannibalize syndication fees, and so they chose not to have that show available on Hulu. It was and still is complicated, in large part because of how young the streaming business was. It was hard to know what would be important. Now, arguably, it wasn't hard to know what was important to the audience. The audience wanted access to their favorite shows. They wanted it to be in a reasonable way where they're not waiting a month to get the next or the latest episode. They wanted it to be cost efficient so they're not spending ridiculous amounts of money to do it, and preferably they'd like it to come along without an overabundance of ads. But for the cable companies, you know, the channels, the studios, the TV shows, Hulu itself, all the media companies that were part of this, things were less clear. So the negotiation process was a long, complex and often it was unique from case to case, so it was a huge hassle. Honestly, it's a miracle that Hulu was able to persist at all, particularly when you consider that ultimately the corporate owners are competitors with each other other. Stuff that was going on outside of Hulu would also have a major impact on the general landscape as well. Amazon's digital video offerings were picking up steam despite the company changing the service multiple times. So Amazon started with a service called Amazon Unbox where you could buy a digital copy of a movie and then you downloaded it. You weren't streaming it, you were downloading it to your computer to watch later. But this would eventually become Amazon Video on Demand. Then it became Amazon Instant Video, and then it became Amazon Prime Video, but from Amazon Video on Demand. Further, it was pretty much the streaming model, so the streaming options were really going on. By twenty eleven, Amazon Prime members would get access to Basic Prime Video service as part of their membership, and that boosted things considerably for that service. Also in twenty eleven, Voodoo announced that it was launching its own streaming service. We would also get Twitch in twenty eleven as a spinoff of Justin TV now. Twitch was and is more focused on user generated content, primarily centered around gaming, but not exclusively, so you are not supposed to rebroadcast stuff like television and films on Twitch. But Twitch is important because while it didn't directly compete with Hulu as far as content goes right, it's two different types of content. It does compete with Hulu when it comes time to talk about where are customers spending their time and money. If they're doing it on Twitch instead of Hulu, well then Twitch is still a competitor, even though you would argue they're not in exactly the same business. Cable channels and providers were also creating on demand viewing options for customers around this time. So, for example, in twenty ten, HBO introduced HBO Go. This would let HBO subscribers access on demand HBO programming through a website, app, or digital media player. Customers had to first authenticate that they were in fact a pay being subscriber to an HBO package in their cable television service, then they would be able to access this content online. Cable providers were doing similar stuff, allowing customers to authenticate their identity and then access a suite of content online. So the streaming industry was starting to coalesce, but it was taking different pathways depending upon who was behind the service. But now let's skip ahead a couple of years. So Hopkins had taken over as CEO at the end of twenty thirteen. The next really big development in Hulu's history, besides the fact that they would launch more original content, would come in the summer of twenty fifteen, and that's when Hulu announced that customers could pay to access a premium ad on channel. The first premium ad on channel Hulu would offer would be Showtime. Now this is interesting from a corporate standpoint because once again there's a lot of dramatic stuff happening behind the scenes. You know, forget shows like Dexter or Penny Dreadful that were on Showtime, The really juicy drama was happening in corporate boardrooms. So Showtime falls under the corporate umbrella of CBS. And if you recall, CBS was the one major broadcast network in the United States that was not a partner in Hulu because you had NBC, Fox, and ABC, which again was owned by Disney being the stakeholders of the company. CBS had tried to go its own way, first with TV dot Com and then in twenty fourteen, CBS launched CBS all Access. In twenty twenty one, CBS all Access would transform into Paramount Plus. Again, the streaming world is it's despite the fact that the streaming services world is fairly young, it's not even really more than like twenty years old. It's incredibly complicated and confusing, especially here in the United States. So for CBS to agree to license showtime content to Hulu as a premium add on was an interesting move. Customers who I wanted this add on would have to bump up their subscription fee and additional eight dollars ninety nine cents per month, which is interesting because that meant the add on costs more than the basic Hulu service of seven dollars ninety nine cents. However, it did cost less than it would cost customers if they got Showtime service through a device partner, because that fee was set at ten dollars ninety nine cents. Are you confused yet because I am. Anyway, this seemed to be an indication that the entrenched old media was becoming concerned about the future. You know, maybe putting up staunch resistance to streaming wouldn't work. Maybe it really was inevitable that streaming would at the very least take a big old chunk out of TV's numbers, and so media companies were starting to hedge their bets a little bit. In September twenty fifteen, Hulu would introduce a new option to subscribers, So for twelve dollars a month, you could get your content ad free. Arguably this was a necessary move because Netflix was running away with it in terms of success in the streaming space. So around this time when Hulu introduced this new subscription tier, they had around nine million subscribers in the United States, which isn't bad, but Netflix had forty one million at that point. So Hulu needed a way to gain more subscribers, and the company figured there were folks who were just bulking at the thought of having to pay a subscription and still have to watch ads anyway, So Hulu introduced the tier, so if you wanted to pay less, you could pay the seven ninety nine per month and watch material with ads. For the premium price of twelve dollars a month, you could get that same stuff but without the ads. And the hope was that the folks who really didn't want to deal with ads would now flock on over to Hulu. And you might be saying to yourself, but hang on, didn't Hulu also have a way to watch programming for free with no subscription at all. With ads, you know, you had fewer options. You couldn't watch full seasons, you could only watch a few episodes in the most recent airing of a show, but you still could do that right for free. Doesn't that undermine the subscription strategy? And yeah, it kind of did, which might be why in twenty sixteen Hulu ended the free tier of service. Hulu signed a deal with Yahoo, which would be allowed to do what essentially Hulu had already been doing, airing certain television programs with ads. That one was called Yahoo View, and it would only include the five most recent episodes of the various television shows, and those would only go live eight days after they had already aired on television on the three partner networks. At Hulu, it also had access to other network programming, but again the agreements of that were varied across the board. Meanwhile, over at Hulu, there was a new stakeholder that was joining the partnership. So, just to recap, at this point, the three main partners at Hulu were Comcast, which owned NBC, Universal Disney which owned ABC, and twenty first Century Fox. But joining them was Time Warner, which spent a hefty five hundred and eighty three million dollars for a ten percent steak in Hulu. This was in twenty sixteen. By the end of that year, Hulu would hit twelve million subscribers. Okay, this is a good point for us to take another break, but we'll be back after our message from our sponsors. Okay, we're back. I had just talked about in twenty sixteen how Hulu had hit twelve million subscribers, and that time Warner had purchased a ten percent steak in the company. Twenty seventeen was another huge year for Hulu for lots of different reasons. In May of that year, Hulu launched a beta test product called Hulu with Live TV Now. As the name suggests, this service included not just Hulu's library of on demand content, it also included access to live television programming. The service also launched with a DVR like feature. Customers who paid the thirty nine dollars and ninety nine cents per month subscription fee would get access to the live programming on demand programming, and they would have fifty hours of recording storage, so they could, you know, record shows as they were airing live and watch them later. The live programming included the four major broadcast networks, which also included local affiliates in some of the major markets, which is good because if you wanted to watch the news or something. You want it to be the news for your region, not the news for the closest major market. And a bunch of cable television channels were also included in this, not all of them, but a lot, and it made Hulu the first product to carry both live and on demand programming as an internet based service. And if you wanted to subscribe to the live service and also opt out of commercials for the on demand programming, well then you would have to add in that extra four dollars a month to your bill. So just like the basic service which was seven ninety nine or eight dollars a month, and the premium service was twelve dollars a month, same sort of thing, you still had to add that four dollars into your thirty nine and dollars of nine nine cents per month subscription if you didn't want ads on the on demand stuff. Now, I mentioned in the previous episode that Hulu got into the original content game earlier than Netflix by a couple of years. Netflix's House of Cards debuted in twenty thirteen. Hulu had been making original content since twenty eleven. Well, now we're up to twenty seventeen and Netflix had more than caught up by launching various prestige series. House of Cards led the way, but other shows like Stranger Things were also huge hits both critically and commercially. Hulu didn't just sit back, though. The company had produced multiple original films and shows as well, some of which were receiving critical acclaim, and one of them, the series adaptation of Margaret Atwood's dystopian novel The Handmaid's Tale, was a smash success. It was a huge hit with critics. It was very popular, so much so that it was The Handmaid's Tale that became the first series from a streaming network to win an Emmy Award. This was a really big moment for Hulu, and it indicated that original content made for streaming services could stand toe to toe with the stuff that was airing on broadcast and cable television. And it meant that Hulu could claim a first. In a year when Netflix had two series, it had House of Cards and Stranger Things in contention for that Emmy for Best Drama. Following Hulu's triumph was another big shift in leadership. Mike Hopkins, who had led the company since twenty thirteen, announced in October twenty seventeen that he would be stepping down from the company. Randy Freer, who like Mike Hopkins, was a C suite executive at Fox Networks Group, actually came over to become CEO of Hulu and he would stay in that role for just two and a half years. His departure in twenty twenty would be due to some other massive changes at the corporate level, which is what we would call foreshadowing. But I'm going to go straight to it, so I guess it doesn't really count, all right, So let's talk about some of these massive corporate moves that would happen around this timeframe of twenty seventeen to the early twenty twenties. So in twenty eighteen, while Hulu was celebrating its tenth anniversary as well as hitting twenty five million subscribers, AT and T acquired Time Warner. So this is when Time Warner would transform into Warner Media. Now you might remember that in twenty sixteen, Time Warner bought a ten percent steak in Hulu. Well, as part of this whole transfer with the AT and T acquisition, WarnerMedia would ultimately sell back its ten percent steak in Hulu. In twenty nineteen. This would leave the three stakeholders as Comcast, twenty first Century Fox, and Disney, or at least it would have, but in twenty nineteen, Disney acquired twenty first century Fox. This was not a shock, Disney had actually announced the intent to acquire twenty first century Fox back in twenty seventeen. The deal would mean that the movie Studio, twentieth Century Fox, plus several cable channels like FX and the Fox Networks Group would all transfer to Disney. Also transferring to Disney would be Fox's thirty percent stake in Hulu, so that would bring Disney's ownership to sixty percent. Then you have WarnerMedia selling off its ten percent share, Disney bumped up its ownership percentage to around sixty six percent, and Comcast would have essentially the other thirty four percent. Fun reminder, Jason Kylar, the original CEO of Hulu, would be heading up WarnerMedia around this time, and he would continue to do so until Discovery acquired WarnerMedia from AT and T. I told you these things are complicated. So the Mouse House thus gained a majority stake in Hulu, and this pretty much set into motion the events that would lead to Disney ultimately acquiring the whole shebang, but that would turn out to be a very, very long process that technically is still going on today because of disputes over the value of Hulu itself. Randy Freer stepped down as Hulu CEO in twenty twenty, and the new mandate was that whomever led Hulu would report directly to a Disney executive named Kevin Meyer, who was a direct to consumer executive over at Disney. Kelly Campbell, who had been chief marketing officer for Hulu, would become the new president of the company, and she reported directly to Kevin Meyer. More on her in just a second. Let's talk about the myriad of streaming platforms that also were launching around this timeframe. All right, So Netflix and Amazon had been going strong for more than a decade in the streaming space. At this point, CBS All Access was continuing, and then in twenty twenty one would transform into Paramount Plus. WarnerMedia would launch HBO Max, which in some ways was the successor to HBO Go. Disney had actually launched Disney Plus in twenty nineteen. That raised some eyebrows because it looked like Disney was competing against itself. I mean, it owned a stake in Hulu, and then it launches a competing streaming platform called Disney Plus. They also launched ESPN Plus, which obviously focused more on sports. Apple had launched Apple tv Plus in twenty nineteen, NBC Universal launched Peacock in twenty twenty, And those are just the big streaming platforms. There are a lot more that we could mention, and there are also dozens of free ads supported television services also known as fast services. That's like Crackle or two B or the Roku channel and more. What I find interesting is we went from Hulu, which started off as a joint venture between various media compares ed and we would end up with Hulu still being a thing, but the individual competitors had all launched their own independent services. And obviously this really just boils down to Peacock and Disney Plus, because Disney gobbled everybody else up. But yeah, by twenty twenty one, things were very different in the streaming space and there was a lot more competition for viewer time and dollars. Andy'll that's tough. Like a lot of these these services require subscription. They're not free to use, so they are in direct competition with each other, and customers were getting frustrated because the original belief was that, hey, streaming's going to let me access the things I want pretty easily. But in truth, if you want to access all the stuff you potentially like, it means you're subscribing to like half a dozen or more services. Heck, I subscribe to around that many, and there's some I still don't subscribe to, which means like, there are shows I've heard about that I know I would love that I have never seen because I don't have an account with that service. All right, So more drama was happening at the leadership level over at Hulu. I mentioned Kelly Campbell became president of Hulu in twenty twenty, while in twenty twenty one she resigned, and two days after she resigned, she took the job as president of Peacock, the streaming service from NBC Universal, which of course is owned by Comcast. And that seemed like shots fired right, Like, she steps down from Hulu, a joint project between Disney and Comcast, and then becomes head of Peacock, which is owned by Comcast. You know, it's it's very odd Well, Joe Early would replace Kelly Campbell as president of Hulu. Last year he actually got promoted. He's now President of Direct Consumer Disney Entertainment, which puts him in charge of all Disney streaming efforts, so not just Hulu but also Disney Plus. So I think we're currently done with the various corporate shuffling at this point for this part of the story. Anyway, who knows what tomorrow will bring. There were rumors in late twenty twenty three that Hulu might make another go at an initial public offering. In the last episode, I mentioned that there was early talk of a Hulu IPO back in twenty eleven, but that just never came to be. Well, neither would the twenty twenty three IPO, because in twenty twenty three, Disney announced it would acquire Comcast's share of Hulu, which was around thirty three thirty four percent, and that the deal was valued at a minimum of eight point six billion with the B dollars, that's a princely sum. Now. This would also bring an end to the joint venture status of Hulu once and for all. Once this deal closes, Disney had pretty much full control of the company. Anyway since twenty nineteen because it had acquired twenty first Century Fox and gained majority ownership of Hulu. Comcast had largely been a silent partner at that point, but then Comcast also launched the Peacocks service in competition with Hulu. So Disney has been offering various bundles that include Hulu and Disney Plus since two thou nineteen, and has more directly integrated Hulu into Disney Plus bundles since the company's announcement that it was going to acquire full ownership of Hulu. Some have said that Disney's plans to treat Hulu as its way to deliver the non disney Ish stuff in its portfolio is the real heart of the strategy. That Disney Plus will be kept to the more family friendly, traditional Disney content of the Walt Disney Company, and Hulu will be like everything else, essentially now for one last bit of drama. So Comcast has accused Disney of trying to sandbag Hulu leading up to the transfer of ownership, So essentially what Comcast is saying is that Disney has purposefully chosen to favor other deals in favor of Hulu rather than actually growing Hulu, because if they were to grow Hulu, Hulu's value would increase, and then Disney would have to pay more money to Comcast for that thirty three percent. And I guess you can kind of see Disney you here if that's in fact true, that you know, you don't want to invest in making a company more expensive just because you're going to have to pay that money ultimately to acquire the very last bit of it. So why not just let Hulu kind of idle and keep on keeping on until the deal closes, at which point then you can pursue efforts to expand the service. But yeah, still it kind of seems like dirty pool. And to the surprise of no one, Disney and Comcast fundamentally disagree as to how much Hulu is actually worth. Obviously this matters because Disney has agreed to purchase Comcast's thirty three or thirty four percent stake in the company, And in fact, Disney has already paid the eight point six billion dollar minimum to Comcast late last year. But that was just to cover the minimum, right, we know that it was going to be more than eight point six billion. That was just the bottom price. So it's kind of like a down payment. So Comcast and Disney each hired firms to evaluate Hulu's worth to determine how much the final cost of that thirty three percent is going to be, and as I'm sure you can guess, the two sides came up with very different answers. Now, their agreement stated that if their individual evaluations were within ten percent of one another, the final payout would become the average between these two values. But that didn't happen because the two values are not in ten percent of each other. According to Reuter's. Disney hired JP Morgan to estimate Hulu's value, and that amount came to twenty seven point five billion dollars or so. Comcast meanwhile secured the services of Morgan Stanley, which said that Hulu is worth more than forty billion dollars. That's a huge gap, twenty seven point five to forty and it means that the two companies have to hire an independent third party to evaluate Hulu again and to determine its quote unquote real value. I put the reel end quotes because y'all, this all ends up being at least somewhat subjective, and obviously, like Disney had an incentive to have a lower valuation so it wouldn't have to pay as much. Comcasts had an incentive to have a higher valuation so it could get paid more. Now, the way this is going to work is that the third party is going to produce its own valuation. If that valuation is closer to Disney's number than those two valuations get averaged together. That determines how much more money Disney has to pay to Comcast. If the valuation is closer to Comcast's number than those two figures will get averaged, and then Disney will have to cough up the difference, whatever the final damage will be. Disney will then become the sole owner of Hulu. Now, this is not the end of Hulu's story, but it will be the end of it being a joint venture between media competitors. So will Hulu flourish under Disney or will we see its offerings diluted due to competition from other streaming platforms and companies wanting to keep their stuff exclusive for their own platform that they have launched, Or are we going to see a sort of return to the old days, only in the form of bundle that make online streaming look more and more like cable television, where you're going to be paying for a access to a bundle of different services for one monthly fee. I'm betting that last one is going to be the case, at least for a little while. But ultimately, I think audiences are going to decide the fate of these services, each of which has focused more on creating original content and migrated further away from being a rebroadcast service. That's another kind of ongoing through line for all of these different platforms is that the access to the vast library of material that has come out before is part of the strategy, but the thing that attracts new subscribers tends to be original material that you can't find anywhere else. So it was interesting to watch that happen first with Hulu and then with Netflix and Amazon as well, and now with all these different platforms you can find original programming on all of them to some degree or another, that that has become the new approach. Anyway, that is the Hulu story as it stands now. Obviously it's still developing. We're gonna eventually get to a point where Disney does have to pay whatever extra amount is owed to Comcast and then we've got, you know, Hulu, a Disney company, and you'll be able to that. You already are able to subscribe to a bundle of Hulu and Disney Plus. You are if you're not me. I made a goof What I did was when I subscribed to Disney Plus, I chose to go ahead and subscribe for a full year, which means I can't make a change to my subscription status until next November. So while I could technically subscribe to Hulu, I don't want to yet because I'm planning on changing my subscription to Disney Plus and November to get the bundle so that I have access to all that material. But it means in the meantime, I don't have access to it, because otherwise I'm going to have to manage even more subscriptions, and y'all, I just I don't have the brain cells for I'm sure you are aware of that already, just from listening to this podcast. One other thing, we will have a new episode on Friday, but then next week we've got Memorial Day here in the United States, so I'm going to have some reruns on Monday and Wednesday, as I will be out of town and then plan to have another new episode on next Friday as well. Just wanted to make y'all aware of that before it happens, and I hope you are all well. I hope those of you who will be celebrating a long weekend do so joyfully and safely, and I will talk to you again really soon. Tech Stuff is an iHeartRadio production. For more podcasts from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen to your favorite shows.

Welcome to Tech Stuff, a production from iHeartRadio. Hey there, and welcome to tech Stuff. I'm your host, Jonathan Strickland. I'm an executive producer with iHeart Podcasts and how the tech are you? So? In our last episode, I covered the origins of Hulu, the streaming service that started off as a joint venture between NBC Universal and News Corp, two competing media companies. So we got up to twenty thirteen, which was a tumultuous year for Hulu. Jason Kayler, the original CEO for Hulu, the guy who really helped shape what Hulu would become, left the company. His interim replacement would also leave before the year was over. Mike Hopkins, who became the new CEO, had formerly been an executive at Fox Networks Group, and so he came from the news course of the business. Other changes had also happened by that point, right, So Disney joined newscre at NBC Universal and became a joint stakeholder in Hulu. This meant that three of the four broadcast companies in the United States were stakeholders. You had ABC, which was owned by Disney, you had Fox, which was owned by News Corp. And Obviously, NBC Universal had NBC, so CBS was the only holdout. Also, Comcast would acquire NBC Universal, which in itself is a very complicated story. Comcasts first announced this deal in late two thousand and nine. The initial part of this acquisition concluded in twenty eleven after a lot but arguably not enough scrutiny from regulators. But Comcast wouldn't get full ownership of NBC Universal until General Electric divested its remaining stake in the company in twenty thirteen. These things are super complicated, but that's pretty much par for the course for media companies. If you look back over the corporate ownership history of any major media company that's been around for at least a decade, it gets messy. Anyway, Comcast becoming the new corporate daddy to NBC Universal is why we will later be talking about a showdown between Disney and Comcast toward the end of this episode. Another big change also happened in twenty thirteen that would impact the future of Hulu. On June twenty eighth of that year, news Core, which was the media empire of Rupert Murdoch, split in Twain. That is, newscrep would become two separate companies. Now, one of those companies, twenty first century Fox, would include the famous twentieth century Fox film studio, the Fox Television Networks, and a stake in National Geographic Newscrep would be the publishing arm of the company. As part of this divestment, Newscrep transferred its stake in hul to twenty first century Fox. Now this is the reason we don't have to talk about Disney, Comcast and newscre at the end of this episode, because, as I'm sure most of you are aware, Disney subsequently gobbled up twenty first century Fox in twenty nineteen, which means Disney slice of Hulu's high would just get bigger and bigger. But I'm getting ahead of myself, so Hulu was also changing outside of these big corporate maneuvers. The initial business model of Hulu was to offer up ads supported viewing of recent television episodes. So as a user, originally you would go to the Hulu website, so you'd use a laptop or desktop PC and navigate to the Hulu website. Keep in mind, this is when smartphones are a brand new thing, so using a smartphone to navigate the web was still very new when Hulu launched officially in two thousand and eight. So you would use a PC or laptop to go to Hulu's website and you could watch a few of the most recent episodes of various television programs that were provided by content partners. Typically, you could view the episode that had most recently aired on TV anytime between the following day up to the following month. It all depended upon the actual agreement between the studio and Hulu. We'll talk about that again in a bit. You did not have access to the back catalog of episodes of any show, didn't matter what network it was on. You might be able to watch the most recent five episodes, and then on top of that, you could potentially have access to around half a dozen other episodes from across the entire history of a show, but you would have no control over which episodes those would be. So maybe you'd know for a show that had lots and lots of seasons, like ten or more seasons, you might have a couple of episodes from season four, and then maybe a couple from season six or whatever, but they wouldn't necessarily connect to each other and wouldn't be able to say which ones you got to see. Now, just a little bit more backtracking before we continue on with our story, because there's some elements that I did not mention in the last episode. In twenty ten, Hulu had introduced Hulu Plus, a subscription based service that let audiences access an entire season the most recent season of episodes for shows. So you could get access to a full season of episodes, not the entire history, but at least the most recent season if you were a subscriber, and it costs seven dollars ninety nine cents per month. Now I believe that on Monday's episode, I said nine dollars ninety nine cents. That's because I was pulling that from other sources. And to be fair, Hulu has changed its pricing throughout its history, but the actual initial price when it launched was seven dollars ninety nine cents per month. This service was also ad supported, so customers still had to go through some ads in order to do this. So you're paying you know, essentially eight bucks a month, but you also still get ads. So analysts were predicting that this subscription model was going to fail because who the heck was going to pay to access television programming that otherwise they could get for free, although you didn't really get it for free. You got in return for whatever your cable or satellite package was, unless you were actually using antenna to pick up over the air broadcast. Well, it turned out that Hulu's method worked pretty well. It did not go down in flames as the analysts were predicting. In twenty eleven, the service boasted it had hit a million subscribers, and Kyler said that the service would bring in around two hundred million dollars after it had been launched for a year, the subscription service, that is, and that's a lot of money. But then Hulu was also spending a lot of money securing content partners, right because it wasn't just ABC and Fox and NBC that was providing content to Hulu. Hulu was securing licenses with lots of different content partners out there, and that cost money. Cable networks and providers were growing concerned that Hulu was cannibalizing their audiences, and there was a lot of friction in the media space. So, for example, in twenty ten, newscre got into a serious tif with Cablevision, the cable provider these two companies were in a fundamental disagreement over retransmission fees. News Core was playing hardball and it ended up blocking Cablevision subscribers from accessing programming, and that included online programming. So if you were a Cablevision ISP customer and you tried to go to Fox dot com to watch Fox material, or if you tried to watch Fox material on Hulu, you would get blocked, which made a lot of people mad. And it really made people angry that they weren't able to access sports programming because the World Series of Baseball was coming up and Cablevision was trying to hold out from having to pay higher retransmission. This one battle really just encapsulates a much larger story of traditional media versus streaming media. And keep in mind, it's kind of funny because traditional media companies were the owners of the streaming service Hulu. So again, very complicated. Television had been king for decades, but the cord cutting trend was really emerging big time. It would only get worse down the line. Here's a fun side note. Around the same time, CNN reached out to me to comment on the trend of cord cutting. So I did I gave CNN some information about cord cutting and like the trends that were going on at the time and the reason for those trends. And I got a talking too, because at the time, the company I worked for, house stuff Works, was owned by Discovery Communications, a cable channel company cable network company, and Discovery did not like that I was talking about cord cutting, as if some how I was affecting cord cutting, as if I was responsible for it. I was commenting on something that was happening, whether I talked about it or not. And I'm pretty sure that I was not the reason A bunch of people suddenly said, you know what, You're right, it is time we stopped paying cable. So I still think it's funny that I was talked to about this and that it was a whole thing because I'm like, you guys are treating me like I'm way more important than I am, and if I am this important, you need to pay me more. Right. That's the lesson you learned, is that if I'm important enough to be a threat to your business, I'm important enough for you to pay me more money. Anyway, that was a tangent side note, doesn't really matter. The TV based businesses were desperately clinging onto a model that was just going out of style. Thus the talking to I got so my personal opinion is that the decline of broadcast and cable television was inevitable. That nothing that these companies did was going to stop that decline. It was just going to happen. So all they could really do is try and slow things down as much as they could, or to make things difficult on streaming platforms which were kind of in an investment and growth mode, or the traditional companies could try and create their own strategies to segue into the streaming model, the internet based model of delivering entertainment. A lot of those media companies resisted that, or they tried to buy up companies that were kind of already doing that and use that as their on ramp. Hulu itself was kind of an on ramp for that kind of thing. But because these streaming services were in investment and growth mode, it meant they were not focused on making a profit at this time. That was not the main goal of the early years of these services. They were trying to establish a large customer base and to scale as quickly as possible. This was really bad news for the cable industry because it meant that this new competitor was willing to operate at a loss. Right, They were not operating with fear of how it was going to affect their profits because they weren't profitable. They were operating at a way of gaining new customers. But the cable industry was looking at a shrinking customer base and angry shareholders. So they were in a very different situation, and it was a pretty volatile situation. We're technically still kind of in that situation, but at this point, I think most folks acknowledged that cable TV is seriously on the decline. In fact, you know, Kyler wrote an essay in twenty twenty three, the former CEO of Hulu wrote an essay in twenty twenty three that revealed, quote linear television declines at a rate of close to ten percent per year in the United States end quote. And further that quote, the median age for most entertainment shows was over sixty end quote. And that is the median age for linear television entertainment. So, if you've ever wondered why so many TV shows seem to cater to the elderly. That's why the elderly are the ones who are still watching television in the first place. Kyler also said that out of all the streaming platforms in twenty twenty three, and there were a ton of them at that point, only Netflix quote is generating material cash flow from streaming end quote. So Kyler wasn't saying that streaming was a doomed business model, and I'll try to come back and touch on that. I just really wanted to establish the setting that Hulu was part of an early wave of streaming services that were changing the way audiences access entertainment and ultimately how they would challenge the status quo. Okay, we're going to take a quick break. When we come back, we'll talk more about Hulu's evolution. We're back. So one thing that I failed to mention in the previous episode was that Hulu was broadening its access. So again, originally when Hulu launched, it was a website full stop. And keep in mind, like Hulu launched in two thousand and eight, so iPhone comes out in two thousand and seven, we don't really get the app store until two thousand and eight, so we wouldn't get into a glut of smartphone and mobile device apps for a couple more years. The app landscape was still kind of on the horizon when Hulu launched, so the one way you could access Hulu content was on a computer, though if you were willing to put in the work, you could technically use a television as a display and watch content on television that way, but that was kind of janky for most people. It was beyond the reach of a lot of folks. They would wait until there would be more integrated solutions, either with streaming boxes or with smart televisions or that kind of thing. So you couldn't watch Hulu on television in the early days. But a couple of years after launch, Hulu began to release apps and work with device manufacturers to make Hulu available through other devices, which would include smartphones and tablets and over the top services as well as like video game consoles and smart TVs. This wasn't straightforward, however, and the experience could really leave customers frustrated because Hulu still had to secure agreements with all the different content providers, of which there were many, so again, Hulu wasn't just serving up stuff that could be found on ABC NBC and Fox, and not everyone would agree to all the terms and they would require specific exceptions. So for some shows, viewers might be allowed to access an episode on any device running a Hulu app like it could be a computer, a smartphone, it could be or television, doesn't matter. But for other shows, viewers might only be restricted to the web browser version on a PC. So it would be weird because you could log into Hulu on your computer and watch a show like that, but if you were to pull up your Hulu app on a streaming service, like on a box connected to your television, that show would not be there, and that was really confusing. Also, shows would have different premiere dates on Hulu. Some episodes premiered the day after they aired on television, some eight days after they aired, so the following week. Some had a delay of thirty days, so like a full month. And this was all over the place, and it meant that using Hulu was confusing. This was not the fault of Hulu, but because the powerful studios could command these conditions, they were the ones that were dictating the terms. They felt incentivized to do this because they were, you know, they were playing in a new space. Even shows that aired on one of the stakeholder networks on ABC or Fox or NBC, they weren't immune to shenanigans either. So, for example, The New York Times reported that The Middle, which was an American sitcom that aired on ABC, which belonged to Disney, and Disney was a stakeholder, that show was not available on Hulu back in twenty eleven. But why I mean? Like I said, ABC was part of the major stakeholders in Hulu, so what gives? Well, while ABC would broadcast The Middle, the studio that actually made the show was Warner Brothers. So ABC had secured the rights to broadcast the show, but Warner Brothers made the show. Warner Brothers declined to have The Middle available on Hulu. As to why, well, we can only speculate, but chances are it was an effort to protect the show so that it could make more money when it was put into syndication, because syndication is a very lucrative market for first run shows. So chances are Warner Brothers didn't want to cannibalize syndication fees, and so they chose not to have that show available on Hulu. It was and still is complicated, in large part because of how young the streaming business was. It was hard to know what would be important. Now, arguably, it wasn't hard to know what was important to the audience. The audience wanted access to their favorite shows. They wanted it to be in a reasonable way where they're not waiting a month to get the next or the latest episode. They wanted it to be cost efficient so they're not spending ridiculous amounts of money to do it, and preferably they'd like it to come along without an overabundance of ads. But for the cable companies, you know, the channels, the studios, the TV shows, Hulu itself, all the media companies that were part of this, things were less clear. So the negotiation process was a long, complex and often it was unique from case to case, so it was a huge hassle. Honestly, it's a miracle that Hulu was able to persist at all, particularly when you consider that ultimately the corporate owners are competitors with each other other. Stuff that was going on outside of Hulu would also have a major impact on the general landscape as well. Amazon's digital video offerings were picking up steam despite the company changing the service multiple times. So Amazon started with a service called Amazon Unbox where you could buy a digital copy of a movie and then you downloaded it. You weren't streaming it, you were downloading it to your computer to watch later. But this would eventually become Amazon Video on Demand. Then it became Amazon Instant Video, and then it became Amazon Prime Video, but from Amazon Video on Demand. Further, it was pretty much the streaming model, so the streaming options were really going on. By twenty eleven, Amazon Prime members would get access to Basic Prime Video service as part of their membership, and that boosted things considerably for that service. Also in twenty eleven, Voodoo announced that it was launching its own streaming service. We would also get Twitch in twenty eleven as a spinoff of Justin TV now. Twitch was and is more focused on user generated content, primarily centered around gaming, but not exclusively, so you are not supposed to rebroadcast stuff like television and films on Twitch. But Twitch is important because while it didn't directly compete with Hulu as far as content goes right, it's two different types of content. It does compete with Hulu when it comes time to talk about where are customers spending their time and money. If they're doing it on Twitch instead of Hulu, well then Twitch is still a competitor, even though you would argue they're not in exactly the same business. Cable channels and providers were also creating on demand viewing options for customers around this time. So, for example, in twenty ten, HBO introduced HBO Go. This would let HBO subscribers access on demand HBO programming through a website, app, or digital media player. Customers had to first authenticate that they were in fact a pay being subscriber to an HBO package in their cable television service, then they would be able to access this content online. Cable providers were doing similar stuff, allowing customers to authenticate their identity and then access a suite of content online. So the streaming industry was starting to coalesce, but it was taking different pathways depending upon who was behind the service. But now let's skip ahead a couple of years. So Hopkins had taken over as CEO at the end of twenty thirteen. The next really big development in Hulu's history, besides the fact that they would launch more original content, would come in the summer of twenty fifteen, and that's when Hulu announced that customers could pay to access a premium ad on channel. The first premium ad on channel Hulu would offer would be Showtime. Now this is interesting from a corporate standpoint because once again there's a lot of dramatic stuff happening behind the scenes. You know, forget shows like Dexter or Penny Dreadful that were on Showtime, The really juicy drama was happening in corporate boardrooms. So Showtime falls under the corporate umbrella of CBS. And if you recall, CBS was the one major broadcast network in the United States that was not a partner in Hulu because you had NBC, Fox, and ABC, which again was owned by Disney being the stakeholders of the company. CBS had tried to go its own way, first with TV dot Com and then in twenty fourteen, CBS launched CBS all Access. In twenty twenty one, CBS all Access would transform into Paramount Plus. Again, the streaming world is it's despite the fact that the streaming services world is fairly young, it's not even really more than like twenty years old. It's incredibly complicated and confusing, especially here in the United States. So for CBS to agree to license showtime content to Hulu as a premium add on was an interesting move. Customers who I wanted this add on would have to bump up their subscription fee and additional eight dollars ninety nine cents per month, which is interesting because that meant the add on costs more than the basic Hulu service of seven dollars ninety nine cents. However, it did cost less than it would cost customers if they got Showtime service through a device partner, because that fee was set at ten dollars ninety nine cents. Are you confused yet because I am. Anyway, this seemed to be an indication that the entrenched old media was becoming concerned about the future. You know, maybe putting up staunch resistance to streaming wouldn't work. Maybe it really was inevitable that streaming would at the very least take a big old chunk out of TV's numbers, and so media companies were starting to hedge their bets a little bit. In September twenty fifteen, Hulu would introduce a new option to subscribers, So for twelve dollars a month, you could get your content ad free. Arguably this was a necessary move because Netflix was running away with it in terms of success in the streaming space. So around this time when Hulu introduced this new subscription tier, they had around nine million subscribers in the United States, which isn't bad, but Netflix had forty one million at that point. So Hulu needed a way to gain more subscribers, and the company figured there were folks who were just bulking at the thought of having to pay a subscription and still have to watch ads anyway, So Hulu introduced the tier, so if you wanted to pay less, you could pay the seven ninety nine per month and watch material with ads. For the premium price of twelve dollars a month, you could get that same stuff but without the ads. And the hope was that the folks who really didn't want to deal with ads would now flock on over to Hulu. And you might be saying to yourself, but hang on, didn't Hulu also have a way to watch programming for free with no subscription at all. With ads, you know, you had fewer options. You couldn't watch full seasons, you could only watch a few episodes in the most recent airing of a show, but you still could do that right for free. Doesn't that undermine the subscription strategy? And yeah, it kind of did, which might be why in twenty sixteen Hulu ended the free tier of service. Hulu signed a deal with Yahoo, which would be allowed to do what essentially Hulu had already been doing, airing certain television programs with ads. That one was called Yahoo View, and it would only include the five most recent episodes of the various television shows, and those would only go live eight days after they had already aired on television on the three partner networks. At Hulu, it also had access to other network programming, but again the agreements of that were varied across the board. Meanwhile, over at Hulu, there was a new stakeholder that was joining the partnership. So, just to recap, at this point, the three main partners at Hulu were Comcast, which owned NBC, Universal Disney which owned ABC, and twenty first Century Fox. But joining them was Time Warner, which spent a hefty five hundred and eighty three million dollars for a ten percent steak in Hulu. This was in twenty sixteen. By the end of that year, Hulu would hit twelve million subscribers. Okay, this is a good point for us to take another break, but we'll be back after our message from our sponsors. Okay, we're back. I had just talked about in twenty sixteen how Hulu had hit twelve million subscribers, and that time Warner had purchased a ten percent steak in the company. Twenty seventeen was another huge year for Hulu for lots of different reasons. In May of that year, Hulu launched a beta test product called Hulu with Live TV Now. As the name suggests, this service included not just Hulu's library of on demand content, it also included access to live television programming. The service also launched with a DVR like feature. Customers who paid the thirty nine dollars and ninety nine cents per month subscription fee would get access to the live programming on demand programming, and they would have fifty hours of recording storage, so they could, you know, record shows as they were airing live and watch them later. The live programming included the four major broadcast networks, which also included local affiliates in some of the major markets, which is good because if you wanted to watch the news or something. You want it to be the news for your region, not the news for the closest major market. And a bunch of cable television channels were also included in this, not all of them, but a lot, and it made Hulu the first product to carry both live and on demand programming as an internet based service. And if you wanted to subscribe to the live service and also opt out of commercials for the on demand programming, well then you would have to add in that extra four dollars a month to your bill. So just like the basic service which was seven ninety nine or eight dollars a month, and the premium service was twelve dollars a month, same sort of thing, you still had to add that four dollars into your thirty nine and dollars of nine nine cents per month subscription if you didn't want ads on the on demand stuff. Now, I mentioned in the previous episode that Hulu got into the original content game earlier than Netflix by a couple of years. Netflix's House of Cards debuted in twenty thirteen. Hulu had been making original content since twenty eleven. Well, now we're up to twenty seventeen and Netflix had more than caught up by launching various prestige series. House of Cards led the way, but other shows like Stranger Things were also huge hits both critically and commercially. Hulu didn't just sit back, though. The company had produced multiple original films and shows as well, some of which were receiving critical acclaim, and one of them, the series adaptation of Margaret Atwood's dystopian novel The Handmaid's Tale, was a smash success. It was a huge hit with critics. It was very popular, so much so that it was The Handmaid's Tale that became the first series from a streaming network to win an Emmy Award. This was a really big moment for Hulu, and it indicated that original content made for streaming services could stand toe to toe with the stuff that was airing on broadcast and cable television. And it meant that Hulu could claim a first. In a year when Netflix had two series, it had House of Cards and Stranger Things in contention for that Emmy for Best Drama. Following Hulu's triumph was another big shift in leadership. Mike Hopkins, who had led the company since twenty thirteen, announced in October twenty seventeen that he would be stepping down from the company. Randy Freer, who like Mike Hopkins, was a C suite executive at Fox Networks Group, actually came over to become CEO of Hulu and he would stay in that role for just two and a half years. His departure in twenty twenty would be due to some other massive changes at the corporate level, which is what we would call foreshadowing. But I'm going to go straight to it, so I guess it doesn't really count, all right, So let's talk about some of these massive corporate moves that would happen around this timeframe of twenty seventeen to the early twenty twenties. So in twenty eighteen, while Hulu was celebrating its tenth anniversary as well as hitting twenty five million subscribers, AT and T acquired Time Warner. So this is when Time Warner would transform into Warner Media. Now you might remember that in twenty sixteen, Time Warner bought a ten percent steak in Hulu. Well, as part of this whole transfer with the AT and T acquisition, WarnerMedia would ultimately sell back its ten percent steak in Hulu. In twenty nineteen. This would leave the three stakeholders as Comcast, twenty first Century Fox, and Disney, or at least it would have, but in twenty nineteen, Disney acquired twenty first century Fox. This was not a shock, Disney had actually announced the intent to acquire twenty first century Fox back in twenty seventeen. The deal would mean that the movie Studio, twentieth Century Fox, plus several cable channels like FX and the Fox Networks Group would all transfer to Disney. Also transferring to Disney would be Fox's thirty percent stake in Hulu, so that would bring Disney's ownership to sixty percent. Then you have WarnerMedia selling off its ten percent share, Disney bumped up its ownership percentage to around sixty six percent, and Comcast would have essentially the other thirty four percent. Fun reminder, Jason Kylar, the original CEO of Hulu, would be heading up WarnerMedia around this time, and he would continue to do so until Discovery acquired WarnerMedia from AT and T. I told you these things are complicated. So the Mouse House thus gained a majority stake in Hulu, and this pretty much set into motion the events that would lead to Disney ultimately acquiring the whole shebang, but that would turn out to be a very, very long process that technically is still going on today because of disputes over the value of Hulu itself. Randy Freer stepped down as Hulu CEO in twenty twenty, and the new mandate was that whomever led Hulu would report directly to a Disney executive named Kevin Meyer, who was a direct to consumer executive over at Disney. Kelly Campbell, who had been chief marketing officer for Hulu, would become the new president of the company, and she reported directly to Kevin Meyer. More on her in just a second. Let's talk about the myriad of streaming platforms that also were launching around this timeframe. All right, So Netflix and Amazon had been going strong for more than a decade in the streaming space. At this point, CBS All Access was continuing, and then in twenty twenty one would transform into Paramount Plus. WarnerMedia would launch HBO Max, which in some ways was the successor to HBO Go. Disney had actually launched Disney Plus in twenty nineteen. That raised some eyebrows because it looked like Disney was competing against itself. I mean, it owned a stake in Hulu, and then it launches a competing streaming platform called Disney Plus. They also launched ESPN Plus, which obviously focused more on sports. Apple had launched Apple tv Plus in twenty nineteen, NBC Universal launched Peacock in twenty twenty, And those are just the big streaming platforms. There are a lot more that we could mention, and there are also dozens of free ads supported television services also known as fast services. That's like Crackle or two B or the Roku channel and more. What I find interesting is we went from Hulu, which started off as a joint venture between various media compares ed and we would end up with Hulu still being a thing, but the individual competitors had all launched their own independent services. And obviously this really just boils down to Peacock and Disney Plus, because Disney gobbled everybody else up. But yeah, by twenty twenty one, things were very different in the streaming space and there was a lot more competition for viewer time and dollars. Andy'll that's tough. Like a lot of these these services require subscription. They're not free to use, so they are in direct competition with each other, and customers were getting frustrated because the original belief was that, hey, streaming's going to let me access the things I want pretty easily. But in truth, if you want to access all the stuff you potentially like, it means you're subscribing to like half a dozen or more services. Heck, I subscribe to around that many, and there's some I still don't subscribe to, which means like, there are shows I've heard about that I know I would love that I have never seen because I don't have an account with that service. All right, So more drama was happening at the leadership level over at Hulu. I mentioned Kelly Campbell became president of Hulu in twenty twenty, while in twenty twenty one she resigned, and two days after she resigned, she took the job as president of Peacock, the streaming service from NBC Universal, which of course is owned by Comcast. And that seemed like shots fired right, Like, she steps down from Hulu, a joint project between Disney and Comcast, and then becomes head of Peacock, which is owned by Comcast. You know, it's it's very odd Well, Joe Early would replace Kelly Campbell as president of Hulu. Last year he actually got promoted. He's now President of Direct Consumer Disney Entertainment, which puts him in charge of all Disney streaming efforts, so not just Hulu but also Disney Plus. So I think we're currently done with the various corporate shuffling at this point for this part of the story. Anyway, who knows what tomorrow will bring. There were rumors in late twenty twenty three that Hulu might make another go at an initial public offering. In the last episode, I mentioned that there was early talk of a Hulu IPO back in twenty eleven, but that just never came to be. Well, neither would the twenty twenty three IPO, because in twenty twenty three, Disney announced it would acquire Comcast's share of Hulu, which was around thirty three thirty four percent, and that the deal was valued at a minimum of eight point six billion with the B dollars, that's a princely sum. Now. This would also bring an end to the joint venture status of Hulu once and for all. Once this deal closes, Disney had pretty much full control of the company. Anyway since twenty nineteen because it had acquired twenty first Century Fox and gained majority ownership of Hulu. Comcast had largely been a silent partner at that point, but then Comcast also launched the Peacocks service in competition with Hulu. So Disney has been offering various bundles that include Hulu and Disney Plus since two thou nineteen, and has more directly integrated Hulu into Disney Plus bundles since the company's announcement that it was going to acquire full ownership of Hulu. Some have said that Disney's plans to treat Hulu as its way to deliver the non disney Ish stuff in its portfolio is the real heart of the strategy. That Disney Plus will be kept to the more family friendly, traditional Disney content of the Walt Disney Company, and Hulu will be like everything else, essentially now for one last bit of drama. So Comcast has accused Disney of trying to sandbag Hulu leading up to the transfer of ownership, So essentially what Comcast is saying is that Disney has purposefully chosen to favor other deals in favor of Hulu rather than actually growing Hulu, because if they were to grow Hulu, Hulu's value would increase, and then Disney would have to pay more money to Comcast for that thirty three percent. And I guess you can kind of see Disney you here if that's in fact true, that you know, you don't want to invest in making a company more expensive just because you're going to have to pay that money ultimately to acquire the very last bit of it. So why not just let Hulu kind of idle and keep on keeping on until the deal closes, at which point then you can pursue efforts to expand the service. But yeah, still it kind of seems like dirty pool. And to the surprise of no one, Disney and Comcast fundamentally disagree as to how much Hulu is actually worth. Obviously this matters because Disney has agreed to purchase Comcast's thirty three or thirty four percent stake in the company, And in fact, Disney has already paid the eight point six billion dollar minimum to Comcast late last year. But that was just to cover the minimum, right, we know that it was going to be more than eight point six billion. That was just the bottom price. So it's kind of like a down payment. So Comcast and Disney each hired firms to evaluate Hulu's worth to determine how much the final cost of that thirty three percent is going to be, and as I'm sure you can guess, the two sides came up with very different answers. Now, their agreement stated that if their individual evaluations were within ten percent of one another, the final payout would become the average between these two values. But that didn't happen because the two values are not in ten percent of each other. According to Reuter's. Disney hired JP Morgan to estimate Hulu's value, and that amount came to twenty seven point five billion dollars or so. Comcast meanwhile secured the services of Morgan Stanley, which said that Hulu is worth more than forty billion dollars. That's a huge gap, twenty seven point five to forty and it means that the two companies have to hire an independent third party to evaluate Hulu again and to determine its quote unquote real value. I put the reel end quotes because y'all, this all ends up being at least somewhat subjective, and obviously, like Disney had an incentive to have a lower valuation so it wouldn't have to pay as much. Comcasts had an incentive to have a higher valuation so it could get paid more. Now, the way this is going to work is that the third party is going to produce its own valuation. If that valuation is closer to Disney's number than those two valuations get averaged together. That determines how much more money Disney has to pay to Comcast. If the valuation is closer to Comcast's number than those two figures will get averaged, and then Disney will have to cough up the difference, whatever the final damage will be. Disney will then become the sole owner of Hulu. Now, this is not the end of Hulu's story, but it will be the end of it being a joint venture between media competitors. So will Hulu flourish under Disney or will we see its offerings diluted due to competition from other streaming platforms and companies wanting to keep their stuff exclusive for their own platform that they have launched, Or are we going to see a sort of return to the old days, only in the form of bundle that make online streaming look more and more like cable television, where you're going to be paying for a access to a bundle of different services for one monthly fee. I'm betting that last one is going to be the case, at least for a little while. But ultimately, I think audiences are going to decide the fate of these services, each of which has focused more on creating original content and migrated further away from being a rebroadcast service. That's another kind of ongoing through line for all of these different platforms is that the access to the vast library of material that has come out before is part of the strategy, but the thing that attracts new subscribers tends to be original material that you can't find anywhere else. So it was interesting to watch that happen first with Hulu and then with Netflix and Amazon as well, and now with all these different platforms you can find original programming on all of them to some degree or another, that that has become the new approach. Anyway, that is the Hulu story as it stands now. Obviously it's still developing. We're gonna eventually get to a point where Disney does have to pay whatever extra amount is owed to Comcast and then we've got, you know, Hulu, a Disney company, and you'll be able to that. You already are able to subscribe to a bundle of Hulu and Disney Plus. You are if you're not me. I made a goof What I did was when I subscribed to Disney Plus, I chose to go ahead and subscribe for a full year, which means I can't make a change to my subscription status until next November. So while I could technically subscribe to Hulu, I don't want to yet because I'm planning on changing my subscription to Disney Plus and November to get the bundle so that I have access to all that material. But it means in the meantime, I don't have access to it, because otherwise I'm going to have to manage even more subscriptions, and y'all, I just I don't have the brain cells for I'm sure you are aware of that already, just from listening to this podcast. One other thing, we will have a new episode on Friday, but then next week we've got Memorial Day here in the United States, so I'm going to have some reruns on Monday and Wednesday, as I will be out of town and then plan to have another new episode on next Friday as well. Just wanted to make y'all aware of that before it happens, and I hope you are all well. I hope those of you who will be celebrating a long weekend do so joyfully and safely, and I will talk to you again really soon. Tech Stuff is an iHeartRadio production. For more podcasts from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen to your favorite shows.