Apple rumored to be making a bid for HULU

Fri, Jul 22, 2011

News, Rumors

Apple’s cash hoard now rests at about $76.2 billion, and for a company reluctant to pay out any dividends, it’s only natural to wonder what in the world Apple plans to do with all that cash. Either way, with tens of billions in the bank, Apple can essentially do anything it wants – even something as seemingly crazy as purchasing Hulu.

Yep, Bloomberg is reporting that Apple is toying with the idea of making a bid for Hulu.

Hulu would give Apple a new subscription service and represent a possible challenge to Netflix Inc. Hulu’s media- company owners, Walt Disney Co., News Corp. and Comcast Corp. NBC Universal, are offering suitors a five-year extension of program rights, including two years of exclusive access, people familiar with the matter said earlier this week.

“Part of the ecosystem of Apple’s future is to include more video,” said Scott Sutherland, Wedbush Securities Inc. analyst in San Francisco who recommends buying the stock. “It’s something they are focused on.”

Certainly an intriguing idea as Integrating the service into the rumored Apple HDTV would certainly be compelling. As of August, Hulu claimed to have over 1 million subscribers while CEO Jason Kilar anticipated revenues approaching $500 million in 2011.

But does Hulu’s business model really fit into Apple’s? It’s hard to see a fit, but stranger things have happened.

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