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Who In Their Right Mind Would Buy Hulu?

Rumors have surfaced in the past 24 hours that premium content video provider Hulu has been fielding unsolicited offers to buy the platform. The question, of course: who in their right mind would want to buy Hulu?

Yahoo is the name that has emerged. The Los Angeles Times and Wall Street Journal both reported through unidentified sources that the Web portal reached out to Hulu. Yet, TechCrunch has cited sources that say Yahoo did no such thing. Sales of this size and complexity generate lots speculation with a plethora of moving pieces. Let’s examine the possibilities to see who would make the best suitor for Hulu.

When it comes to corporate organization, Hulu is about as complicated a company there is on the Web. Hulu is owned by a combination of Comcast (NBC), News Corp. (Fox), Disney (ABC) and Providence Equity Partners and the relationship between the three competitors has always been difficult. Comcast has no corporate control over Hulu, a stipulation put in place when its acquisition of NBC Universal when it was approved by the Federal Trade Commission.

To sell, any suitor would have to deal with Hulu’s board and then probably have to clear regulatory approval. That will take some ingenuity by the company making the offer. The problem with Hulu is that any one of these companies can pull its content from the site after the end of the existing agreement (which was reportedly recently renewed) ends. Wresting control of Hulu away from the networks would also mean that the new owner would have to license content, cutting into the profitability of the business model.

Let’s take a look at the candidates:


This cannot be good for consumers. Yahoo is the land where good products go to die. (Delicious can testify, Flickr would probably love to be set free.) But, Yahoo is less of a technology company these days and more of a content company. When it comes to premium content, there is not much else out there other than Hulu. Without it, Yahoo would have to create a new product and arrange to license content from individual network providers themselves


AOL is really in the same boat as Yahoo, a once-giant Internet corporation focusing on content to sell ads. As such, Hulu would make a nice feather in AOL’s content cap. Yet, after acquisitions of The Huffington Post and TechCrunch and the investment in local news through Patch, how many shillings are available to AOL to make big content acquisitions?


Of the big Internet companies with lots of money and motivation, Amazon might have the most clout to pull off a deal with the networks. It already provides streaming content through Prime memberships. It could integrate Hulu with Prime streaming options or keep it intact as is and generate more users by bundling it within existing Amazon products. Amazon could make it very easy for users to sign up for Hulu Plus with its one-click purchasing option.


These three go together, mostly because anytime there is talk of some type of acquisition, people look towards the brand with the most buying power. Google would make the most sense as it is the only one of the three with a significant investment in Web content (YouTube, Blogger) and the YouTube division would be very happy to add premium content to its mix and eliminate its prime competitor in one fell swoop. Google would have to win regulatory approval for that, no sure thing. Apple and Microsoft … well, they just have a lot of money and would probably like to limit their dependence on Netflix for premium content streaming on their mobile devices.

An Existing Partner

Scenario: one of the three networks buys the other two out while also assuring licensing agreements for an extended period of time. Maybe Comcast would like to buy its board seat back (effectively eliminating the board entirely and skirting the FTC regulation). Disney probably would not go that route. Of the three, Disney is the least beholden to the Hulu partnership. News Corp. likes to make a splash but other than its proclivity to make big moves, it is not likely.

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