Hulu already has Walt Disney's (NYSE:DIS) ABC, Comcast's (NASDAQ:CMCSA), and FOX (NASDAQ:FOX) as partners. Adding Time Warner (NYSE:TWX), which owns HBO, TBS, TNT, and more, as a partner could eventually give the service access to a lot more top-tier, must-see programming.

It's a deal that has been rumored and the two companies have even talked, according to The Wall Street Journal. The discussions valued the streaming service at $5 billion and Time Warner would have become a partner alongside Walt Disney, Comcast, and Fox, with three partners diluting their 33% shares of the company, the paper reported.

You can see why Hulu would want to make that deal. Not only does Time Warner control a lot of highly valuable content, it also has a streaming product of its own, HBO Now, which competes with Hulu for subscribers.

If the streaming service could bring on Time Warner as a partner under the same terms it has with Walt Disney, Comcast, and Fox it could add shows from TWX within days of them airing on TV. Even if HBO content was excluded from that deal, the four-way partners could bundle the pay channel's streaming service with its own creating a pretty impressive package.

It sounds like a great combination, at least for Hulu's owners and subscribers, but it's not going to because Time Warner CEO Jeff Bewkes has another vision.

What does the CEO want?
In Time Warner's recent earnings call Bewkes spoke about moving his company away from deals that make its content available to cord cutters and non-subscribers quickly. He made it clear that he is a strong supporter of on-demand options for paying customers, but believes in protecting the traditional cable bundle.

Time Warner CEO Jeff Bewkes Source: TIme Warner

"We're evaluating whether to retain our rights for a longer period of time and forego or delay certain content licensing," the CEO said. "This would effectively push the SVOD window for content on our networks to a multiyear period more consistent with traditional syndication."

Waiting years to get a show has generally not been the Hulu business model. Yes, it just paid $180 million for Seinfeld reruns, but that's a unique show. Generally the streaming service has differentiated itself by offering shows from its partner networks within a few days of their broadcast window.

It's easy to see how doing that could ultimately convince people they no longer need to pay for cable and Bewkes is right to be concerned.

The Hulu model is a disruptor
Time Warner waited a long time to sell HBO as a stand-alone that does not require a cable subscription to protect its other cable channels as well as the industry as a whole. That's not an altruistic gesture, its likely because the company knows that while there is upside to an HBO streaming service sold on its own the same is likely not true for TBS, TNT, and the rest of its cable portfolio.

HBO also gives cable customers a full-on streaming version of its service, HBO Go, for free with their cable subscription. That's also an attempt to protect the traditional model and indirectly support Time Warner's other channels.

Making a deal with Hulu simply makes no sense for Time Warner. The $7.99 a month streaming service is already a good value that offers a solid amount of near real-time programming. Adding in TWX content would create a package that, at least to non-sports fans, would be a decent portion of the best of cable, on a brief delay from when the shows first air.

Joining up with Walt Disney, Comcast, and Fox would be Time Warner shooting itself perhaps not in the face, but perhaps in the fleshy part of the thigh. It has some upside, but the positives aren't worth the damage the company would be doing to its own properties.