With the annual week-long Sun Valley gathering of media execs kicking off, rumors of Hulu's potential sale are heating up with the temperatures.
The L.A. Times, citing unnamed sources, reported that Google (NASDAQ:GOOG) has begun preliminary talks with Hulu execs, who already have met with potential buyers Microsoft (NASDAQ:MSFT) and Yahoo, sources said.
Analysts said Hulu would likely sell for some $2 billion, the same valuation that Netflix carries. Hulu is expected to see revenues of about $500 million, this year, its CEO Jason Kilar has said, and anticipated 1 million subscribers will sign up for its premium service, Hulu Plus.
A sale to Google would be a huge gain for the search engine giant, which has had a difficult time making inroads into the tight-knit Hollywood establishment. Hulu currently is owned by News Corp., Disney and Comcast's NBCUniversal. A deal for Hulu would give it an entrée into Tinseltown.
Microsoft, too, could see big results from a Hulu deal, as it has looked to expand the role of its Xbox game platform as an alternative set-top box. It already offers ESPN, Hulu Plus and Netflix to users.
Yahoo, which reportedly made the earliest approach to Hulu, has embarked on its own strategy of bringing premium content to its users. Hulu would augment that process.
Both Disney and News Corp. recently signed content deals with Hulu to make it more attractive to buyers.
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