This could be a jam-packed month in technology dealmaking, and it’s not just because of the drama unfolding over AT&T’s bid for T-Mobile USA. Nope, another interesting development is occurring in the board rooms of some of the biggest media and technology companies as bidders line up for Hulu.
Hulu is an unusual asset — in part because of an ownership structure tied to some of the biggest media companies on the planet: NBCUniversal, News Corporation and The Walt Disney Company.
But it is an attractive asset too, one of the reasons why bids reportedly are expected in the $1.5 billion to $2 billion range. (Hulu’s board apparently is due to look over bids later this week).
There’s a reason why Yahoo, Amazon and Dish Network are reportedly knocking on the doors of the company. (DirecTV reportedly dropped out of the bidding this past weekend).
While Hulu’s viewership numbers aren’t quite as big as some rivals, people are spending more and more of their time on the site. According to comScore, visitors spent an average of 3.4 hours per month watching programming on Hulu, second only to Google’s video sites.
Peter Kakfa at All Things D today offers some additional details on why Google might be wooing Hulu, writing that the search giant’s offer might be different than what the owners of the company had anticipated.
Interesting. What might that be? Kakfa doesn’t have details.
But, it could play into a theory floated by GeekWire guest author Bud Albers last week in a column titled: Google’s bigger game: The subplot behind the Motorola acquisition.
In the piece, Albers notes that Google’s bid for Motorola might be part of a larger strategy to gain control of set-top boxes and possibly push deeper into the living rooms of Americans.
Google’s gains are potentially enormous. Executed properly, this move not only could have tremendous financial benefit, but it strategically vaults Google past Apple and Facebook in significant ways. At the highest level, integration of this sort greatly opens up web-centric content to the living room, increases the utility of the mobile devices, and significantly increases Google’s ad targeting opportunities while enabling the overriding fiscal goal of serving more ad impressions.
The most fundamental reason that Google will not give up on integrating with the television is that it quite simply holds the highest growth potential for the company.
It holds a significant dual opportunity for them. If they can successfully change the game, they can not only serve more ads, but they can also increase the value of each ad served by using the integration with the traditional channels to shift advertising dollars away from television and into this new world.
A former Disney technology executive, Albers floats a few theories on how Google might use Motorola to get a bigger share of TV advertising, including partnerships with cable companies. Could Hulu be part of that larger strategy?
That will be interesting to watch, as will Amazon.com’s move.
As we’ve noted in the past, Amazon.com CEO Jeff Bezos is tight with Hulu CEO Jason Kilar. Merging Hulu with Amazon could be interesting on many levels, especially as the online retailer looks to roll out its Android-based tablets later this year.
A Hulu channel on an Amazon tablet could provide an added spark for the retailer as it looks to compete head-to-head with Apple’s iPad. And it is worth noting that Amazon has already rolled out a Kindle subsidized with “special offers” (also known as advertisements).
But there’s another interesting idea at play here too. Amazon is hiring a bunch of advertising talent, perhaps to mine the mountains of consumer data it already has on its massive customer base. Adding the viewing habits of Hulu into that mix could be fascinating, and a move that Google (the king of online advertising) certainly would want to repel.
However the Hulu bidding plays out, it could be as riveting for the tech industry as the much-anticipated season opener of Mad Men.