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Apple 'considering $2 billion Hulu bid'

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Hulu
Apple is reportedly in the early stages of negotiations with Hulu about acquiring the US video on-demand website.

Individuals close to the talks have claimed that the world's second most valuable company is looking to buy Hulu from current owners, Disney, News Corporation and NBCUniversal, reports Bloomberg.

Apple is thought to view an acquisition of Hulu as a way to provide a video subscription service to challenge US market leader Netflix. Disney, News Corp and NBCUniversal are thought to be offering suitors a five-year extension of programme rights, including two years of exclusive access, if they stump up the $2bn (£1.23bn) price tag for Hulu.

Scott Sutherland, Wedbush Securities analyst, said that Apple views video as a key part of its future plans. He said: "Part of the ecosystem of Apple's future is to include more video. It's something they are focused on."

Apple certainly has the means to complete such an acquisition, with $76.2 billion (£46.7bn) in cash and securities on its books. This week, the company also reported record quarterly profits of $7.31bn, up by 125% year-on-year.

However, Sutherland noted that Apple does not tend to make such large acquisitions, with the firm's biggest ever deal being the $400 million it spent on NeXT Software in 1996, which returned Steve Jobs to the company.

Disney president and chief executive Robert Iger recently told the Wall Street Journal that partners in Hulu were "committed to selling" the business.

The joint venture is thought to have held talks with around a dozen firms about the sale, including Microsoft and Yahoo. Morgan Stanley and Guggenheim Partners are handling the discussions.

Apple has so far taken a relatively tentative approach to TV and video on-demand, merely redesigning its Apple TV service in September last year to support video streaming and more content.

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