Michelle Clancy ©RapidTVNews | 28-09-2011 The bids for online TV site Hulu.com are in and the results are...disappointing.
According to the Business Insider, DISH Network was the top bidder, offering $1.9 billion for the site and its two-year exclusive content deals, falling short of the $2 billion+ that Hulu's owners were hoping to snag.
Hulu’s owners, including FOX, Disney/ABC, and Comcast/NBCUniversal, have said that if they could not raise $2 billion in the sale, they may put the sale on hold, and that could very well happen.
Google made a $4 billion offer, but tied it to lengthening the existing exclusive content rights to current season fare, meaning that the real value of the deal is likely less than DISH's offer. Such a deal would also tie FOX, Disney/ABC and NBCUniversal's hands for a critical period of time when it comes to digital distribution of its sought-after programming.
Bids from Amazon and Yahoo! meanwhile reportedly weren't even in the ballpark, hovering around $1.5 billion.
Amazon with its own streaming service, Google's YouTube and DISH's just-launched Blockbuster streaming service could all benefit greatly from the content licencing that comes along with Hulu, since current programming is something that users place a premium on and have been proven to be willing to pay for. It's an especially good time to strike given Netflix's recent customer drain in the wake of raising its rates.
But the sale of Hulu has been fraught with issues. The company boasts 1 million users for its Hulu Plus rising revenues of $500 million in 2011, with profit margins that its owners claim are ever-widening. Even so, it's the content that would command a $2 billion price tag, and many see two years of rights as not long enough to justify it. That's particularly true considering that Hulu's media owners would almost certainly turn to other outlets for its lucrative prime time programming.
In fact, NBCUniversal has said that is planning to offer free programming via iPhone and iPad without requiring a cable subscription, while FOX said that Hulu users can only access new TV shows if they have a pay-TV subscription. Both moves undermine Hulu's future viability.