Media company and cable TV provider Time Warner Cable is rumored to be reviewing a deal to buy an equity stake in streaming video service Hulu, according to a Wall Street Journal report that cites unnamed sources familiar with the matter.
Hulu’s current owners — News Corp., Disney, and silent owner Comcast — have disagreed on the best way to grow the service, which initially led to them trying to sell Hulu last year for around $2 billion. When no one came close to that asking price, the Hulu sale was officially terminated. However, renewed interest from several potential buyers made the owners flip-flop once again on the idea of selling.
But not much has changed between now to drastically increase Hulu’s value in the eyes of buyers, which means either the asking price is lower or the owners are exploring alternatives. One of them is apparently adding Time Warner Cable as a minority shareholder. I’m not entirely sure how bringing in another decision-maker to Hulu would be the best idea, especially since News Corp. and Disney already can’t agree on the site’s future business strategy. At the same time, it would give them less liability should Hulu fail.
If true, TWC would definitely get the better end of the deal. Hulu is a great brand when it comes to streaming current prime time TV shows legally. Hulu is seeing record growth in paid subscribers, advertising revenue, and users — not to mention its original content strategy. Time Warner could also forge a deal to offer its cable TV subscribers free access to Hulu, just as other cable providers have done by having them authenticate that they subscribe to a cable TV service package.
But Time Warner Cable isn’t the only company expressing interest in purchasing Hulu. Other potential buyers of the site include Yahoo, Amazon, Guggenheim Digital Media , and former News Corp. president Peter Chernin with a rumored $500 million offer. WSJ‘s report also indicates that another large TV media company could be interested in buying a partial stake in the company along with Time Warner.
h/t a Bloomberg