Disney’s Hulu Quest For More Black Viewers

By CultureBanx Team

  • Disney will have a controlling interest of 60% in Hulu once the Fox Deal closes

  • African Americans stream videos more frequently on all devices than the total U.S. population

Disney (DIS +1.72%) is betting on Hulu’s future success by investing in more original programming and taking the streaming service into new international markets. With African Americans streaming videos more frequently on all devices than the total U.S. population, it will be important for the mouse house to create authentic black content.

Why This Matters: When Disney closes on its $71.3 billion acquisition of Fox, it will gain a majority control of Hulu. They will have a dominant interest of 60%, Comcast (CMCSA +0.10%) and Time Warner will be reduced to minority stakeholders, with 30% and 10% stakes respectively. Disney will need to use this greater control of Hulu to help its 20 million subscribers compete against Netflix and their 125 million subscribers.

Netflix already has a deep roster of major black content creators on their team from the Obamas, to Shonda Rhimes and even Kenya Barrish

Netflix already has a deep roster of major black content creators on their team from the Obamas, to Shonda Rhimes and even Kenya Barrish, just to name a few. The video streaming leader is also spending more than $8 billion on original content. Amazon (AMZN -2.42%) followed Netflix and made a beeline towards this demographic by inking a deal with Jordan Peele, and is on track to shell out $4 billion plus on original programming.

The competition for Disney and Hulu doesn’t end there. Apple (AAPL -1.93%) recently announced its original content will be free and they’re writing $1 billion in content checks. As part of the company’s strategy to entice more African American viewers to the platform, they struck a multi-year content partnership deal with Oprah Winfrey this past summer. Free content shows Apple wants to have a bigger stake with this group, by betting authentic black storytelling is the key to winning viewers and platform loyalty.

What’s Next: In addition to better positioning Hulu against Netflix, Disney said its upcoming streaming rival will be called “Disney+” and will launch in late 2019. The new service will carry content from Disney's top brands like Marvel, Star Wars, and Pixar. They will add this to the ESPN+ streaming platform, which has 1 million subscribers.

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