Why Does Everyone Want a Bite of Hulu?
Last week, multiple rumors emerged that companies were looking to either get a share of Hulu or buy it outright. Yahoo! Inc. (NASDAQ:YHOO) and Time Warner Cable Inc. (NYSE:TWC) were among the first rumored, and now DirecTV (NASDAQ:DTV) is back on the list.
AllThingsD reported that numerous sources close to the situation claimed that Yahoo Chief Executive Officer Marissa Mayer and Chief Operating Officer Henrique De Castro had met with Hulu executives to discuss an acquisition. The deal may never go through, as the sources suggested that Yahoo may not get sufficient licensing rights to the content on Hulu to make it a worthwhile deal. However, it was also suggested that Yahoo could just take a stake and join Disney (NYSE:DIS), News Corp. (NASDAQ:NWSA), and Comcast (NASDAQ:CMCSA) as an owner of Hulu.
Bloomberg and Dow Jones both suggested that Time Warner Cable was also on the hunt to get a bite of Hulu. The cable provider would be able to extend its services greatly by including the online streaming service among its offerings. However, taking a share of a company that Comcast — a major rival — owns could open the door for some trouble in the competition between them.
Now it’s coming out that DirecTV is also in the running to take a slice of the pie. The company already has the market-leading satellite-TV business, and adding the online component could help it spread its presence and be more marketable to consumers everywhere.
However, this isn’t the first time DirecTV has shown interest in snatching up some of Hulu. In 2011, the company had considered buying a share of the streaming service but decided against it because of issues with content rights — similar to the issue Yahoo would have without buying Hulu outright. The story may be the same this time around for DirecTV.
One possibility is that one of the three companies currently owning Hulu could get bought out. News Corp and Disney apparently don’t agree about the future direction of the company, so it’s possible either of them could depart, and rather than leaving a company owned by only two others, any of the three companies bidding for a share of Hulu could potentially come on board.
With an audience of some four million subscribers, Hulu presents a big opportunity for any of these companies to expand its customer base. However, it’s uncertain who can actually get a piece of Hulu, and what exactly any of them wish to do with their bite.
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