Here’s Why Hulu Just Got More Attractive to Potential Buyers
Bloomberg breaks news today that online television, film, and web-based media streamer Hulu.com has coaxed its joint-owners NBC Universal (NASDAQ:CMCSA)(NYSE:GE), News Corp. (NASDAQ:NWSA), and Disney (NYSE:DIS) to offer five years of guaranteed access to their TV shows, among the most popular content Hulu holds, to a potential buyer. The offer will also include two years of exclusive access to shows on their networks. The announcement should heat up interest among the large group of prospective shoppers, which include Yahoo (NASDAQ:YHOO), Microsoft (NASDAQ:MSFT), Google (NASDAQ:GOOG), AT&T (NYSE:T), Verizon (NYSE:VZ), and Amazon (NASDAQ:AMZN).
Concerns over the renegotiations of TV rights were among the most prominent uncertainties at stake in a potential Hulu takeover, as the company’s owners had previously given no assurance that they would continue to make their content available on the site. If this happened, Hulu could’ve been relegated to a host of added-content, special events, and dated re-runs, and would likely have sacrificed a great deal of its popularity. Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) reportedly refused to place bids for Hulu until such rights were included in the deal.
The company, which many expected to IPO, has foregone that path and instead opted to find a buyer. Hulu recently announced that it will hit the 1 million monthly subscriber mark (at $7.99 per month) for its Hulu Plus service this year. CEO Jason Killar said the company may breach $500 million in revenues this year. Morgan Stanley (NYSE:MS) bankers are leading the process of the sale.