Apple may be considering a bid to purchase online video streaming company Hulu.
Two things are at play here – first, Hulu is apparently looking for a buyer, and second, the digital video space is one area that Apple has tried to break into has failed to grab a strong foothold.
Hulu is perhaps the most direct competitor to Netflix. Other similar services like Vudu, CinemaNow, and Blockbuster Online, charge users on a pay-per-view basis. Where Netflix has managed to attract so much attention is in its monthly “all you can eat” package, allowing users to watch as many movies and TV shows as they want with no limit.
But where Netflix falters is that it has no access to recent content. Most movies are available months after they come out on home video formats, meaning Netflix is really only an option for users who want to watch old movies.
But Hulu puts TV shows up for viewing usually less than 24 hours after they air live. The Hulu Plus service lets users watch some of these shows on their TVs and mobile devices, and also makes thousands of back-episodes available, including many that are not available on Netflix.
Apple has about $76 billion in cash and investments – liquid assets – that it could use to buy out Hulu immediately. Hulu is currently owned by a conglomerate of media companies.
According to Bloomberg, preliminary discussions have already taken place between Hulu and Apple. And the Wall Street Journal reports that other giants like Google and Yahoo are also considering whether Hulu would make a good fit to their respective portfolios.