October, it appears, is a month for reversals: Netflix (Nasdaq: NFLX) abandoned its plans to spin off its DVD business, and Comcast's (Nasdaq: CMCSA) Universal Pictures decided that risking a boycott by movie theater chains to trial its VOD release time of Tower Heist wasn't worth the gamble. So, it should come as no real surprise that Hulu's owners have called off the sale of the video aggregator, too.
Hulu's owners, Disney (NYSE: DIS), News Corp. (Nasdaq: NWSA) and Comcast's NBCUniversal, announced yesterday afternoon that the sale, which had attracted a bevy of bidders--none apparently who were willing to pony up enough cash to make it worth the sale--was off. At least it's off for the moment.
According to a release from the owners:
"Since Hulu holds a unique and compelling strategic value to each of its owners, we have terminated the sale process and look forward to working together to continue mapping out its path to even greater success. Our focus now rests solely on ensuring that our efforts as owners contribute in a meaningful way to the exciting future that lies ahead for Hulu."
That the sale never actually went through isn't that surprising; there was dissent reported among the owners as to whether selling Hulu was a good idea from the very beginning. Only Disney CEO Bob Iger ever came out and said the site should be sold.
That the drama lasted so long, however, is another story. But look at the process for what it was: an opportunity to gauge interest in Hulu and what it might be worth.
The top bid of $1.9 billion from Dish Network (Nasdaq: DISH), was well below the price Hulu and its owners expected (they had a higher bid from Google (Nasdaq: GOOG), but were unwilling to accept the content caveats Google reportedly was demanding). The firing of Yahoo CEO Carol Bartz didn't help either. It was, after all, Yahoo that apparently made the first inquiries into whether Hulu was for sale. Finally, the woeful performance of Netflix's stock deflated the price Hulu might have seen.
From the outset, what Hulu actually had for sale was a question many buyers asked. Even Dish's bid was rumored to be more about the site's technology than about the short-term content deals that were being guaranteed.
Yahoo withdraws Hulu bid; Dish has edge
Hulu says hola to Univision with multi-year content deal
Will $1.9B bid from Dish seal a deal for Hulu?
Hulu sale hits turbulence; are owners up in the air about moving forward?