By Michelle Castillo

Disney isn't taking any chances in its crusade to win the streaming wars.

Disney ($DIS) is reportedly in talks with AT&T's WarnerMedia about acquiring its 10 percent share of Hulu. A November 2018 filing from Disney put Hulu's value at $9.26 billion, pegging WarnerMedia's share at about $926 million. Disney did not respond to Cheddar's request for comment, and WarnerMedia declined to comment.

Disney has plans to enter the streaming market through its upcoming Disney+ service, which will include original "Star Wars" and Marvel shows as well as its library of movies and TV shows. It also has sports-centric ESPN+. It will have to convince subscribers, who have endless options, to come on board for both those services.

But Hulu is a safe bet for the entertainment giant because it's already a known brand, with an already existing base of 25 million subscribers, as of 2018.

Hulu also has a lucrative ad revenue model, something Netflix ($NFLX) and Amazon ($AMZN) Prime Video lack. The company said it made $1.5 billion in advertising revenue last year. It also has a live TV service, which reached over 1 million subscribers in September of 2018.

Maintaining its hold on Hulu allows Disney to keep its more family-friendly content on its branded service, while putting more edgy and provocative programming on another. Thanks to its ownership, Hulu has many existing content deals with several major networks, including Disney's ABC, Comcast's NBCUniversal properties, and Fox. It's also invested heavily in original series, including the wildly-popular "The Handmaid's Tale." And with Disney pulling its movies from Netflix when its own streaming service launches, Hulu will cement its home for exclusive content, especially for Disney and potentially Fox shows.

At this stage, Disney, Comcast, and 20th Century Fox each own 30 percent of Hulu. If Disney's purchase of Fox and the alleged WarnerMedia deal goes through, it could own 70 percent of Hulu. But if for some reason regulators bar the Disney-Fox merger, the WarnerMedia stake would still give Disney control over the company.

WarnerMedia, on the other hand, is preparing its own three-tiered streaming service. In a call with analysts in November 2018, AT&T CFO John Stephens said the company is "reviewing our $500 billion balance sheet and looking for opportunities to monetize assets that are not essential to [its] strategies." He mentioned the company's minority investments in SKY Mexico or Hulu as a potential way to transform $6 billion into $8 billion in additional cash for the company.

It remains to be seen if Disney's competitors will yank their shows from Hulu if the company assumes majority ownership. Comcast CFO Mike Cavanagh said at the UBS Global Media and Communications Conference in New York in December 2018 the company does not want to sell its Hulu shares, saying its content has "a great home on that platform." However, Comcast is getting ready to launch its own streaming service ー there's no word if its shows will jump ship as well. On the other side, WarnerMedia said it intends to pull some of its content back onto its own service when it launches, including beloved property "Friends." It remains to be seen if it will allow other shows to exist on Hulu if it doesn't have any ownership share.