Time Warner Buys 10% Stake in Hulu for $583 Million3 Aug, 2016 By: Erik Gruenwedel
As expected, Time Warner has acquired a 10% minority stake in Hulu, the subscription streaming service co-owned by The Walt Disney Co., 21st Century Fox and Comcast. The $583 million investment values Hulu at about $5.8 billion — reportedly three-times what it was worth in 2012.
As part of the deal, Time Warner said Turner properties such as TNT, TBS, CNN, Cartoon Network and Turner Classic Movies would be involved in Hulu’s pending online TV service launching next year.
“The investment in Hulu reflects Time Warner’s continued commitment to supporting innovative digital services that allow consumers to access high-quality content however they want it across a variety of platforms,” the media company said in a statement.
Time Warner’s other properties, Warner Bros. and HBO, will not offer content to Hulu, which has about 12 million subscribers — about a quarter of Netflix’s 47 million domestic subs. HBO CEO Richard Plepler said the premium channel was engaged in “constructive conversations” regarding including the brand in the online TV service.
Time Warner CEO Jeff Bewkes has made no secret his admiration for Hulu — which many media companies consider a much-needed competitor to Netflix and Amazon Prime Video.
Speaking on the company's Q1 fiscal call in May, Bewkes said OTT video and SVOD reflect evolving consumer habits toward consuming home entertainment.
The CEO said on-demand access underscores a “vibrant re-birth of the strength of TV networks and TV programming.”
“Maybe we want every one of our networks in these OTT packages. I think we need to include that in a larger view of how the industry is evolving,” Bewkes said at the time.