Hulu Sale Called Off
Hulu is no longer for sale — and its current owners claim their strategies for the Internet TV site are fully in sync.
On Friday, 21st Century Fox, NBCUniversal and The Walt Disney Co. jointly announced that they will maintain their respective ownership positions in Hulu and together provide a cash infusion of $750 million “to propel future growth.”
While the move indicates Hulu’s owners didn’t like the final offers on the table, which they received last Friday, company insiders said the decision was more about settling on the right strategy for “the future of where our content was going to live” and noted that keeping Hulu was always one of the outcomes under consideration.
DirecTV, a combo bid from AT&T and Chernin Group, and Time Warner Cable had been the last three contenders. Hulu’s owners were originally hoping to bring in $2 billion for the company, but bids had come in at less than $1 billion. It’s not known what the final offers from DirecTV, AT&T-Chernin and TWC (which was seeking a partial ownership stake) were.
According to Disney and 21st Century Fox execs, they came to the conclusion to keep Hulu in the fold not because the bids were too low but rather because they feel it has the potential to become an even bigger player in subscription VOD and take on Netflix and others.
Disney chairman and CEO Bob Iger told reporters at the Allen & Co. conference in Sun Valley, Idaho, on Friday that the decision was not the result of evaluating the bids, calling them “good, solid offers.”
“The future of Hulu is bright, and if the future of Hulu is bright then we should hold on to it,” he told reporters.
In a prepared statement, Iger said, “Hulu has emerged as one of the most consumer-friendly, technologically innovative viewing platforms in the digital era. As its evolution continues, Disney and its partners are committing resources to enable Hulu to achieve its maximum potential.”
Chase Carey, prexy and COO of 21st Century Fox, commented, “We had meaningful conversations with a number of potential partners and buyers, each with impressive plans and offers to match, but with 21st Century Fox and Disney fully aligned in our collective vision and goals for the business, we decided to continue to empower the Hulu team, in this fashion, to continue the incredible momentum they’ve built over the last few years.”
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News Corp. and NBC launched Hulu in 2008, as a response to the rise of YouTube and other online-video sites. The media companies were looking for a way to aggregate premium TV content in a way they could control and monetize. Disney came on board in 2009.
In 2011, Hulu’s parents had looked to unload their joint venture, but similarly called that off after engaging in discussions with interested buyers reported to have included Google, Yahoo, Dish Network and Amazon.
Hulu now has more than 400 content partners and boasts more than 30 million monthly unique visitors, according to the company. In 2010, it launched Hulu Plus, an $8-per-month service that provides additional content not available on the free site, including past seasons of many TV series. Hulu Plus, which has more than 4 million subscribers, also provides access across multiple Internet-connected devices, including TVs and tablets.