Hulu to Receive As Many As 5 First-Round Bids
September 5, 2011 10:58 AM
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Google, Yahoo, Amazon and DISH Network are all preparing bids for the acquisition of Hulu
Among those who have prepared bids for Hulu are Google, Yahoo, Amazon and DISH Network
We learned just a few months ago that Hulu had placed a "for sale" sign on its store window, and now, the video streaming subscription service site is to receive about five
Earlier this year, Hulu, which is owned by Walt Disney Co., News Corp., Comcast Corp. and Providence Equity Partners Inc., was working to renew licensing agreements in order to increase its value on the open market. In June, Fox Broadcasting Co. renewed its licensing agreement, which brought shows like "Family Guy," "Glee," and "The Simpsons" back to Hulu. With such agreements in its back pocket, Hulu had something to offer subscribers and could finally have a shot at attracting a buyer.
went up for sale
in late June, almost immediately after
Yahoo approached Hulu
about a possible acquisition, yet Hulu wasn't ready to sell at that point.
Now, Hulu is to receive as many as five first-round bids where each offer included terms for programming rights. Bid prices are still unclear, but the
Wall Street Journal
expects that bids will range between $500 million and $2 billion.
Among those who have prepared bids for Hulu are Google, Yahoo, Amazon and DISH Network.
Hulu's owners will grant the winner five years of rights to TV shows, which includes two years of exclusivity. According to Chase Carey, chief operating officer of News Corp., the sale process is trucking alone right on schedule.
"We'll see where it ultimately ends up," said Carey. "For us, it's still a decision to see what it looks like at the end, and does it make sense to pursue that path, or does it make sense for us to stay in an ownership position and continue to have it driven by content owners."
It's tough for video streaming services to compete in a very Netflix-driven world, but with recent issues like Netflix's
subscription price hikes
of the satellite TV channel Starz (which is supposedly going to release its movies through contractual negotiations with DISH's Blockbuster streaming movie service), new competitors could give Netflix a run for its money.
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9/7/2011 5:48:16 PM
Well, I didn't mean to discount the value of Youtube so much.. I personally use it everyday, whereas I haven't been to Hulu in years. I was merely trying to emphasize the incredibly vast difference between the two services.
I think you are also emphasizing the premium aspect of Hulu much more than the 'free' side. Hulu+ gives you access to every season/episode of nearly every show created by the 3 media company owners as well as increased resolution and less ads. Meanwhile, the free side gives you a vast selection of the most recent episode(s) of currently running shows if not the entire current season; as well as a good selection of older, more obscure or foreign shows -- in exchange for stomaching a reasonable amount of ads (still less than on television)...
I thought about it a bit, though, and realized it all comes down to the specifics of the licensing.. Does this include the entire media catalog of all three companies, or only what's currently on Hulu? Does the sale price include
licensing fees for 5 years? Is exclusive
exclusive? To what extent? Online only, of course; but what about show/movie availability in other outlets such as iTunes or marketting content on the provider's own sites?
If the answer to many or all of those questions is 'yes' -- then this can indeed be a game-changer, and I could imagine the bidding reaching several billion dollars..
"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer
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