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Disney’s long-awaited plan to bring it into the 21st century is finally beginning to reveal itself.

Expand chart
Data: Company and analyst reports; Chart: Axios Visuals

The big picture: Its acquisition of AT&T's minority stake in Hulu shows that the entertainment giant is more invested in bundling its services as an attractive alternative to Netflix, rather than building a standalone Netflix killer.

Between the lines:

  • In a must-read piece for Vulture, Josef Adalian argues that Disney's plan is to use Disney+ as a gateway to create other streaming destinations that may one day cater to different types of audiences around the world.
  • This, Adalian argues, is not too far off to the theme park model Disney uses to showcase its mega-franchises, like Pixar, Marvel and Star Wars.
  • Hulu, of course, would be one of those destinations, as would its sports subscription bundle ESPN+ and its Indian streaming behemoth Hotstar.
  • The company said last week that it might sell Hulu as a part of a bundled service with Disney+ and ESPN+.
  • AT&T said Monday that it's selling its minority stake of Hulu into Hulu's streaming video joint venture, giving Disney a total of 66% ownership of Hulu and Comcast/NBCUniversal a 33% ownership.

Be smart: Pricing matters, and analysts are bullish on Disney's $7 monthly bill.

  • BTIG Analyst Rich Greenfield explains in a note to clients that Disney's price points look attractive compared to some of its premium cable counterparts, like Showtime and Cinemax.
  • As for WarnerMedia's pricing plans: "Even if we can justify HBO’s existing premium price point of $14.99, with Disney+ in the marketplace at just $6.99, it would appear to make the launch of a premium to HBO-priced WarnerMediaFlix service challenging," Greenfield writes.

Yes, but: For now, it's worth noting that everyone is losing money in the streaming wars.

  • A recent analysis from MoffettNathanson projects that Disney won't start making money off Hulu until 2023, and it won't make money off of its other services by then either.
  • Netflix raised its long-term debt last year by another $2 billion.
  • AT&T says it will use the proceeds from the Hulu transaction to reduce some of its massive debt load that it incurred from the Time Warner deal last year.
  • Disney told investors it thinks it can get 60–90 million global subscribers in the next five years. That's still a far cry from Netflix's 139 million global subscribers, and the company projects that it brought in another 9 million last quarter.

The bottom line: Via Adalian: "People need to stop thinking of the streaming wars as a zero-sum game — but it will have some serious and legit competition among folks who want to cut the cord and programming costs."

Go deeper

Updated 48 mins ago - Politics & Policy

British national named in Colleyville synagogue standoff

A law enforcement vehicle sits near the Congregation Beth Israel synagogue on Jan. 16. Photo: Brandon Bell/Getty Images

British national Malik Faisal Akram took four people hostage at a Texas synagogue outside Fort Worth on Saturday, the FBI said in a statement.

State of play: Authorities had initially declined to release the name of the 44-year-old suspect or identify the hostages, all adults, though police chief Michael Miller confirmed that one of those held was Rabbi Charlie Cytron-Walker, who leads the congregation.

Updated 1 hour ago - Politics & Policy

Omicron dashboard

Illustration: Brendan Lynch/Axios

  1. Health: Concerns grow over CDC's isolation guidelines — Experts warn of more COVID-19 variants after Omicron — WHO recommends 2 new treatments — What "mild" really means when it comes to Omicron — Deaths are climbing as cases skyrocket.
  2. Vaccines: America's vaccination drive runs out of gas— Puerto Rico expands booster shot requirements— Supreme Court blocks Biden's vaccine mandate for large employers.
  3. Politics: Vivek Murthy calls SCOTUS vaccine mandate block "a setback for public health" — Focus group says Biden weak on COVID response, strong on democracy
  4. Economy: America's labor shortage is bigger than the pandemic— — CDC COVID guidance for cruise ships to be optional starting Saturday — The cost of testing.
  5. States: West Virginia governor feeling "extremely unwell" after positive test — Youngkin ends mandates for masks in schools and COVID vaccinations for state workers — America struggles to keep schools open
  6. World: Beijing reports first local Omicron case weeks before Winter Olympics — Teachers in France stage mass walkout over COVID protocols.
  7. Variant tracker
6 hours ago - Sports

Novak Djokovic loses Australian visa appeal

Novak Djokovic of Serbia plays a forehand during a practice session ahead of the 2022 Australian Open at Melbourne Park on January 14, 2022. Photo: Daniel Pockett/Getty Images

Tennis star Novak Djokovic left Australia on Sunday evening, facing a three-year visa ban after an appeals court in the country revoked his visa.

Driving the news: Djokovic will not be able to defend his Australian Open title when the tournament starts in Melbourne. The World No. 1 is looking to break a three-way tie with Roger Federer and Rafael Nadal for most Grand Slam men's singles titles.