The valuation is a sharp jump from 2016, but is still dwarfed by Netflix
AT&T has sold its stake in Hulu, a media streaming service values at a whopping $15 billion, for $1.43 billion. The major of its stakes are now share between two major media companies, Walt Disney and Comcast. Hulu's initial value of $5.8 billion has jump since Time Warner bought stake for the company in 2016. But this cannot be compare to it powerful competitor, Netflix, who values at roughly around $150 billion. After AT&T sell back its 9.5% stake, Comcast and Walt Disney will now have to negotiate on how it could be divide between the two companies.
The reason for AT&T to sell back its share in Hulu is because it is in the process of developing their own media-streaming service similar to Hulu and Netflix. Neither the name nor the price for this upcoming service has been yet discuss but it is plans for "a three-tiered service built around WarnerMedia's HBO TV series with added content from its Warner Bros. studio and cable-TV brand."
This will add to even more tense competitions among every other main stream media-streaming services. Hulu has already lower its monthly subcription price to $6 per month, but raises the cost of its live TV offers. In order to draw consumers in, these media streaming services must stand out from their competitors. Customers must see what one service can offer while the others cannot so they could make their decision of chosing the one that can offer them the most out of their money.
This can be relate to marketing due to the fact that each platform must come up with marketing strategies to promote and differentiate themselves from the others. They could offer different type of shows and movies from each other that helps to attract consumers in. If every single company offer the same things, there would be no competition among each other and their gross profit might not increase.
Source: https://www.wsj.com/articles/at-t-sells-hulu-stake-valuing-video-service-at-15-billion-11555370949
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