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This article was published on July 22, 2011

Apple reportedly considering Hulu purchase, but why?

Apple reportedly considering Hulu purchase, but why?
Matthew Panzarino
Story by

Matthew Panzarino

Matthew Panzarino was Managing Editor at TNW. He's no longer with the company, but you can follow him on Twitter. Matthew Panzarino was Managing Editor at TNW. He's no longer with the company, but you can follow him on Twitter.

Apple is currently in early talks regarding making an offer to purchase Hulu says Bloomberg, who cites two people ‘with knowledge’ of this pending move.

The talks are apparently in early stages that may lead to an acquisition of the Los Angeles based media streaming company Hulu by Apple, themselves an online media powerhouse, although not focused on streaming.

These kinds of rumors about ‘early talks’ should always be taken with skepticism, because in the financial world ‘early talks’ could mean as little as a lunch meeting. Hollywood is very much this way too. If you browse movie news sites you’ll see a dozen stories a week about this or that actor being in ‘early talks’ about a role in a movie, but nine times out of ten, for one reason or another, it doesn’t happen.

If this report is accurate, however, it could indicate that Apple is intending to make a serious play into streaming content to its devices in a much more aggressive way. Movies and TV shows can be streamed directly to Apple’s Apple TV product from the iTunes store, but the majority of Apple’s devices require that you download content to them before watching.

Nevertheless, it’s a bit hard to see what Apple would gain from an acquisition of Hulu. They already know how to stream content, even if they’re not doing it wholesale on the web like Hulu is. It’s possible that Apple wants Hulu’s infrastructure to help it jump start its own streaming business, but Apple just served up 3.6 Petabytes of info in a day getting Lion out to 1 million customers. I think they have their infrastructure in place. In the end, if anything, it’s likely the licenses that Hulu has that allow it to stream media from the major movie and TV studios that Apple would be after.

If those licenses transfer with the purchase of the company, which they don’t always do, Apple could have a several-year deal in place immediately to begin offering content that sites like Netflix and Hulu have been offering, in-house, directly to iPhone and iPad users.

Hulu just renewed its licensing deal with Fox, even as it has put itself up for sale. It clearly knows that the licenses that it carries make it attractive to potential buyers.

I would be surprised if this panned out to anything that actually takes place, but if it does, it could be a cool product. Would you pay a subscription to Apple to watch TV and Movies on all of your iDevices?