US-based online video site Hulu has ended take-over talks with Google, Yahoo and Dish Network after its owners decided to focus on building the site’s ad and subscription revenues instead.
The three owners of Hulu, News Corp., the Walt Disney Co. and Providence Equity Partners has been hoping to to fetch $2bn out of a potential sale of the company.
However, last Thursday, the three firms issued a statement saying they saw more value in retaining the popular 3-year-old service than in selling it off.
“Our focus now rests solely on ensuring that our efforts as owners contribute in a meaningful way to the exciting future that lies ahead for Hulu,” the owners said.
Santa Monica-based Hulu was placed on the auction block in June after its backers received an unsolicited overture for the site, which consistently ranks among the top destinations for watching video online.
The free, ad-supported version of Hulu attracts more than 26 million visitors a month, according to measurement firm ComScore.
This summer, the paid Hulu Plus service hit a milestone of 1 million subscribers and is now available on 120 million devices.
Among the suitors for the site were Google, Yahoo and satellite TV distributor Dish Network.
But as the process proceeded, there was disagreement among the owners about whether to shed the asset.
People familiar with the auction said the media owners were unwilling to offer long-term licenses to the entertainment content under terms that would fetch top dollar from potential buyers.
Hulu has gained traction with online viewers who come to watch current episodes of such popular shows as “Modern Family,” “The Office” and “Parenthood.”
But during the summer, Fox imposed an eight-day wait to view new episodes of “Glee” and other popular broadcast shows on the Hulu site. Only subscribers to the Hulu Plus service or the Dish Network can see the latest shows the day after their initial airing.
Hulu’s media owners position the decision to retain the site differently. People close to the matter say the service holds greater long-term value for those owners, who will continue to control a dominant online distributor with a growing advertising and subscription business.
