Time Warner is taking a ten percent stake in Hulu, joining existing owners Disney, 21st Century Fox and Comcast’s NBCUniversal, Variety reported today. The move should help bolster Hulu’s programming by adding content from Time Warner’s channels, like Turner networks and CNN, which will be part of a new pay TV service that Hulu wants to launch next year. Terms of the investment were not disclosed, but sources claim that Time Warner paid around $583 million for its stake in Hulu, boosting its valuation to a cool $6 billion.
“Hulu, with the cash infusion and Time Warner’s strategic backing, now has additional firepower to challenge subscription video-on-demand leader Netflix in acquiring original shows, cutting licensing deals and expanding its service,” writes the publication.
As for Hulu’s upcoming service, it should cost around $40 per month, include features like a cloud-based DVR functionality with reminders and offer some of the most popular channels, including Turner networks like TNT, TBS, CNN, Cartoon Network, Adult Swim, truTV, Boomerang and Turner Classic Movies which will be available live and on-demand on Hulu’s new live-streaming service.
“We are very proud that Turner’s networks will be included in our planned live streaming service,” said Hulu CEO Mike Hopkins.
At one point, Apple was apparently interested in purchasing Time Warner to help launch a skinny TV bundle of its own. However, Time Warner CEO Jeff Bewkes told Bloomberg that those efforts were more about the efforts of the technology companies like Apple to improve the television user interface than about acquisition talks.
“That particular one is more about the efforts of the technology companies, Apple included, who we’ve been trying to help because we want this better user interface, and what they should do and how would they get involved,” he was quoted as saying.
He doesn’t think that Apple was serious about acquiring Time Warner.
Apple’s boss of Internet Services and chief content negotiator, Eddy Cue, recently argued that Apple actually wants to be a delivery platform, not a Netflix rival, and has no interest in building a skinny TV bundle.
Network execs ran to the press to dispute Apple’s claim and suggest that the company’s “hard-nosed” negotiation tactics have slowly but surely “alienated” cable providers.