Chapek's Bold Proclamation: I'm Keeping Hulu and ESPN. (Dan Loeb Is Pissed)
The Disney CEO isn't listening to Wall Street about keeping his options open on the table. And now investors want to know why the hell he'd keep Hulu (not as good as Disney+) or hold on to ESPN
Disney Chief Executive Officer Bob Chapek doubled down on the world’s largest entertainment company’s intention to acquire Comcast’s stake in Hulu as soon as it can, and that it has no intention to sell or spin off its profitable sports network ESPN.
Chapek told investors at the Goldman Sachs + Technology conference Wednesday that he feels ownership of both Hulu and ESPN will help position Disney to become the leading streaming service, unseating Netflix.
“I do believe that we have to have full ownership of Hulu to integrate with Disney+, and we would love to get to the end point earlier,” he said (reiterating similar statements he said over last weekend’s D23 Expo). “If we can get there, I’d be more than happy to try and facilitate that.”
On industry speculation that Disney may try to sell or spin off its ESPN sports division, he said definitively: “Disney is the place where ESPN can be maximized rather than that asset sitting anywhere else. Despite the market demand to sell or spin off ESPN… we like where it sits.”
This means Disney will have three separate streaming platforms to contend with as the entertainment giant plots it way forward in an increasingly more competitive streaming landscape. The company has forecast it will have between 135 million and 165 million core Disney+ subscribers by 2024, which is when the service is expected to turn a profit.
Isn’t Hulu the K-Mart of streamers? Does anyone subscribe? Tell The Intersect.
There’s been no decision yet on if Disney will merge Disney+, Hulu and ESPN into one platform or offer them as an a la carte bundle. The three platforms boast a combined 221 million subscribers, but Chapek noted that the company priced its flagship Disney+ at “a pretty absurd” $6.99 a month when it launched in 2019 — and that’s one reason why it makes less money per user versus competitors.