Time Warner Buys 10 Percent Stake in Hulu to Help Bolster Live-Streaming Service

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Time Warner has officially taken a 10 percent ownership stake in popular streaming service Hulu, joining a list of companies already invested, including Disney, 21st Century Fox and Comcast/NBC Universal. Time Warner is preparing to invest $583 million into Hulu, “implying Hulu is worth nearly $6 billion,” as Variety pointed out.

The split now divides Hulu up by 30 percent shares for each of the previous three owners, leaving 10 percent for Time Warner’s new co-ownership. The new partner won’t directly contribute any of its network shows into Hulu’s current services, but it will help bolster the company’s upcoming live-streaming service with Time Warner’s line up of channels. Specifically, Time Warner owns TNT, TBS, CNN, Cartoon Network, Adult Swim, truTV, Boomerang and Turner Classic Movies.

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Hulu CEO Mike Hopkins said, “This investment from Time Warner marks a major step for Hulu as we continue to redefine television for both consumers and advertisers. Our two companies have long enjoyed a productive relationship – which includes the availability of past seasons of popular Turner shows on our current SVOD offerings – and we are very proud that Turner’s networks will be included in our planned live streaming service.”

Earlier in May, it was rumored that Apple had considered purchasing Time Warner, to potentially use the company’s assets as a basis for Apple’s own streaming TV service. Yesterday, in an interview with Bloomberg, Time Warner CEO Jeff Bewkes mentioned that this idea — reportedly begun by Apple Executive Eddy Cue — landed more on the side of a mutual partnership rather than an outright merger and acquisition.

That particular one is more about the efforts of the technology companies, Apple included, who we’ve been trying to help because we want this better user interface, and what they should do and how would they get involved. That’s more about that than M&A. I don’t think M&A was serious.

Although many believe that the universal shift to online video-streaming TV bundles is inevitable, Bewkes himself still thinks traditional paid-cable packages will have legs for at least the next decade. The CEO believes that the cable companies will retain their traditional bundle sizes and price points, but that eventually these companies will begin to placate potential cable cutters with “full video on-demand and very good search recommendation and navigation engines.”

Hulu’s upcoming live-streaming service is believed to also offer a cloud-based DVR functionality that will let users record shows and set reminders in an attempt to ease the transition for any user coming from traditional cable boxes. Still, the reportedly $40 per month service “isn’t looking to offer all the hundreds of channels found in the traditional cable bundle,” but merely be an amalgamation of the channels offered by its now-four investors.


Source: Mac Rumors

Source: appleact.com