Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Hulu Goes It Alone

The gavel has fallen in the auction for popular online video streamer Hulu. And the lucky winner is ... no one!

The Wall Street Journal has reported that Hulu's equity owners have backed out after failing to come to an agreement with bidders on the value of future streaming rights. The site is currently owned by News Corp. (Nasdaq: NWSA  ) , Disney (NYSE: DIS  ) , Comcast (Nasdaq: CMCSA  ) , private equity firm Providence Equity Partners, and Hulu employees.

A joint statement posted on Hulu's blog confirmed the decision, saying:

Since Hulu holds a unique and compelling strategic value to each of its owners, we have terminated the sale process and look forward to working together to continue mapping out its path to even greater success. Our focus now rests solely on ensuring that our efforts as owners contribute in a meaningful way to the exciting future that lies ahead for Hulu.

It's an anticlimactic end to a saga that began in June after Hulu received an unsolicited buyout offer from Yahoo! (Nasdaq: YHOO  ) . During the episode, rumored suitors included a slew of heavyweight contenders like (Nasdaq: AMZN  ) , Google (Nasdaq: GOOG  ) , Apple (Nasdaq: AAPL  ) , and Microsoft (Nasdaq: MSFT  ) . Too bad this season finale may leave some viewers hanging indefinitely.

Hulu had become something of a double-edged sword to its media conglomerate owners, who were caught at a crossroads since its existence undermined the time-tested TV business with free ad-supported television shows. The more successful Hulu became, the less its owners knew what to do with it.

The site became profitable early last year, just before launching its paid subscription service, Hulu Plus, in competition with Netflix (Nasdaq: NFLX  ) . Hulu just announced that it has crossed the threshold of more than a million paid subscribers at $8 a pop per month. Hulu CEO Jason Kilar is aiming for at least $500 million in revenue this year.

The decision to call off a sale seems to signal that the owners are starting to recognize the value of what they have on their collective hands. Hulu has become a veritable force to reckon with in the world of online video streaming.

Personally, I feel an odd sense of relief that Hulu isn't being swallowed whole by a Goliath who would likely end up retooling the site to its needs, although the service would have fit in perfectly with many of the would-be suitors. I would have been in favor of an Amazon match, if I had to choose.

But you know what they say about woulda, shoulda, and coulda. As a regular Hulu-er, I'm perfectly happy with the status quo.

Fool contributor Evan Niu owns shares of, Apple, and Walt Disney, but he holds no other position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Google, Microsoft, Apple, and Yahoo!. Motley Fool newsletter services have recommended buying shares of Google, Walt Disney, Apple, Netflix, Yahoo!, Microsoft, and Motley Fool newsletter services have also recommended creating a bull call spread position in Microsoft and Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (1) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 15, 2011, at 3:51 PM, sikiliza wrote:

    I agree that Amazon would have been the best suitor for Hulu given Jeff Bezos' renewed and successful focus on cloud services. Hulu would have worked well with Amazon's Whispersync which allows uninterrupted content access across different devices (think starting off a movie in your home, continuing to watch it on your phone on your way over the store and ending it back at home with no interruption).

    Hulu would have been at cross-purposes with google's YouTube and Yahoo couldn't run a business that requires the kind of razor-sharp attention to detail that has made Hulu such a successful play.

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1569917, ~/Articles/ArticleHandler.aspx, 10/23/2016 4:29:33 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 4:00 PM
CMCSA $64.06 Down -0.29 -0.45%
Comcast CAPS Rating: ***
DIS $93.03 Up +1.00 +1.09%
Walt Disney CAPS Rating: *****
FOXA $25.83 Up +0.56 +2.22%
Twenty-First Centu… CAPS Rating: ***
AAPL $116.60 Down -0.46 -0.39%
Apple CAPS Rating: ****
AMZN $818.99 Up +8.67 +1.07% CAPS Rating: ****
GOOGL $824.06 Up +2.43 +0.30%
Alphabet (A shares… CAPS Rating: *****
MSFT $59.66 Up +2.41 +4.21%
Microsoft CAPS Rating: ****