Inside Sources Believe DirecTV will Acquire Hulu this Month
June 18, 2013
Multiple sources familiar with the ongoing Hulu acquisition talks have suggested that a deal with DirecTV is in “very advanced stages” and could close by the end of this month. If the deal is approved, DirecTV would acquire over 4 million paying Hulu Plus subscribers, which generated $695 million in revenue last year, including advertising. The latest negotiations have reportedly ranged in price from half a billion to more than a billion dollars, depending on structure and terms.
“It’s no secret that Hulu’s owners are seeking an acquirer for the premium streaming video on demand (SVOD) platform,” reports PandoDaily. “Over the last several months reports have surfaced of bids from DirecTV, Time Warner Cable, Yahoo, KKR, Guggenheim Digital, The Chernin Group in partnership with AT&T, and Silverlake Partners in partnership with William Morris Endeavor Entertainment.”
A second round of bidding reportedly floated around the $1 billion mark earlier this month.
The article suggests that the deal would be a logical step for DirecTV: “First, DirecTV is one of a select few companies with the resources and wherewithal to absorb Hulu and retain or increase its value. Second, Hulu fills a gaping hole in DirecTV’s offering in a way that it would be hard pressed to achieve by other means.”
However, SlashGear suggest that other suitors, including TiVo, are still pursuing a possible deal: “As the reports about DirecTV’s interest suggested, nothing will be decided on the Hulu front until contracts are signed and money exchanged. If DirecTV and TiVo are two of the three $1bn bidders, that still leaves at least one company which might decide to pitch harder for Hulu.”
“There are major shifts happening in the world of video consumption,” notes PandoDaily. “Companies that can adapt have a chance to remain relevant through the next cycle. Those that can’t may not be around long enough to get a second chance. For DirecTV, the Hulu transaction is an opportunity to decide in which camp it will fall.”
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