Thursday, July 25, 2013

Hulu Not Selling To Time Warner Cable

Time Warner Cable (TWC) is certainly busy these days.  First, they are locked in a license fee battle with CBS for renewal with the current agreement set to expire August 1.  Already, the two are locked in a rancorous negotiation that has spilled over to the public.  And second, they couldn't come up with the price that Hulu wanted to gain a piece of the streaming action. 

To the Hulu purchase, I frankly wonder what the strategic plan would have been should they have acquired an ownership stake in the company.  "The Walt Disney Co., 21st Century Fox and Comcast each own a one-third interest in Hulu."  That means being partners with folks that you also have license fee relationships with.  Would being teamed up with Hulu help future retransmission renewals with ABC and Fox?  As Comcast is a silent partner because they are both a cable operator and programmer, who could guess how negotiations would affect them.  Does Time Warner Cable need Hulu to support its TV Everywhere initiative or is owning them only seen as an investment for future revenue?  To the former, a TV Everywhere play does not seem to be the direction that Hulu wants to take.  More options are available as either a complementary service to cable or as a low cost content distributor for cable cordcutters.

Now that Hulu is off the trading block and TWC is out of the picture, Hulu can once again concentrate on competing in the streaming space against Netflix, Amazon, Redbox, and others.  Step one will be to pursue the subscriber business for Hulu Plus and step two, increasing its content library, with a bigger push toward original and exclusive programming.    And step three, if I can be so bold, the introduction of linear streaming programming; perhaps a subscription based 24/7 news channel.  Maybe Ted Turner might like to advise them on how to start a channel like he did in the early days of cable with CNN. 

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