7 bidders are now interested in buying Hulu

Abstract: According to foreign media reports, online streaming media video site Hulu may be sold again after the news, the parent company and its content partners received a takeover offer from many parties. More than 7 bidders are interested in acquiring the online video network, according to several media reports.

According to foreign media reports, the online streaming media video site Hulu may be sold again after the news, its parent company and content Partners received a takeover offer from many parties.

According to several media reports, 7 bidders are now interested in acquiring the online video site, including pay-TV operator DirecTV, Time Warner Cable, Warner Cable, private equity firm KKR, the Guggenheim Digital Group (Guggenheim Digital), Chernin Group, Silver Lake Group and Morris Endeavor Entertainment Company (William Morris Endeavor), and at the last minute joined the bid for the ranks of Yahoo.

Of course, this is not the first time Hulu has sought the easy Lord. A few years ago, Hulu Parent News Corp and Disney, and the company's then investor Providence Capital (Providence Equity), had sought to sell the streaming video site. (At the time, Comcast, the US cable operator, announced concessions to give up its management of Hulu for a majority stake in NBC Universal, NBCU), so as NBCU, the Hulu-owned party, Have no say in Hulu's sale. )

2011, the US satellite television operators Dish, Amazon, Google (micro-blog), as well as Yahoo and other companies have said they intend to buy Hulu, the company is reported that the purchase price range is between 1.5 billion to 2 billion U.S. dollars. Google's bid is higher, but Google is reluctant to seek a content mandate from Hulu, which News Corp and Disney do not want.

At the time, the industry had a lot of questions about what substantial content the bidders around Hulu could get from the deal. They were unable to find the best answer to the question, which is one reason Hulu's first sale was aborted. But the problems have not gone away, even as the bid for another bid has intensified.

Copyright issues

One of the biggest problems that all bidders will face in acquiring Hulu is what they can get from Hulu and the time limit for authorization. Since its inception, Hulu has an exclusive channel to get content from three of the four major U.S. television networks. But it is now increasingly clear that exclusive copyrights are not the most advantageous for Fox, ABC and NBC (ABC).

Finally, the marginal revenue that Hulu earns for television networks can be said to be negligible compared with television advertising revenues. Moreover, giving Hulu exclusive online broadcasting rights looks like an extra incremental revenue for television network companies, because if television networks are to open up bids for online video services such as Netflix, Amazon Prime Instant video services, and even YouTube To gain more incremental revenue.

"Buying Hulu is like buying a deed in London," Jeson Hershorn Jason Hirschhorn, a former MySpace co-CEO, said in a Twitter tweet. You can live here, but this House doesn't belong to you. ”

Of course, Hulu's new owners may want to have more exclusive content for longer. However, the content copyright party itself wants to be able to do as much as possible to other services to do the same content authorization. This will be the biggest conflict between Hulu's copyright content provider and its acquirer in the deal.

Hulu Brain Drain

Meanwhile, as Hulu sells, many of its core employees are looking for alternatives. Kilar, the company's chief technology Officer (CTO) Richard Tom, Jeson Ki, the CEO of Hulu, left his job earlier this year. Recently, Robert Wang, vice president of the company, also resigned, joining a private car aboard a sidecar.

The executives ' departure was partly the result of Providence capital's sale of shares in the company last summer. As a result, all employees with shares in the company also received dividends. This means that they are no longer shareholders of the company and become ordinary employees.

When an enterprise is acquired or is seeking to be listed, the company's restrictive stock will be unlocked, followed by an employee turnover. Like other companies, Hulu will have more employees in the future who will start thinking about the next step and join the new company.

The true value of Hulu

Providence's recent stake sale has left Hulu with a valuation of $2 billion trillion, nearly twice times as early as the company was founded. Hulu's revenue, which was nearly 700 million dollars in 2012, now has about 4 million Hulu Plus subscribers paying to watch online content.

As previously said, Hulu's real value lies in the ability of its new owners to own those copyrights. A big part of the reason Hulu users opt for paid subscriptions is that Hulu is the only place that can use streaming media to watch TV broadcasts on mobile devices, televisions or online. If these users can find their favorite programs elsewhere, they may not opt to subscribe at Hulu.

Peter Chernin, the former News Corp president, Peter Chenin a 500 million-dollar purchase to Hulu earlier this year, according to reports. The price may appear to be suspected of a low bid, as Hulu received a bid for an offer two years ago, plus Providence's market volatility after the sale of shares.

In addition, most of the bidders involved in the bid for Hulu are private-equity firms that are adept at investing in undervalued assets, rather than media or technology companies that view the online copyright of television programs as a major strategic value.

It seems that the bid for Hulu is "heating up" only from the number of potential acquirers. But at the same time, no matter how Hulu's parent finally decided to sell "pro-son" to anyone, the purchase price would not seem to have reached 2 billion dollars two years ago. With more uncertainty surrounding Hulu's people and content, there are many challenges to recovering costs, regardless of who the buyer is.