Comcast has no say as Hulu considers sale

Jun 27, 2011 By Joe Flint

As speculation continues to swirl around Hulu, one of its corporate owners is forced to sit on the sidelines having no role in the fate of the popular online video site even though the outcome could greatly affect its own future.

That's the position ., the nation's largest cable and broadband operator, finds itself in with regard to , which has retained investment bankers to explore a possible sale of the company. Whereas Hulu's other majority owners - . and . - have seats on the board and a say in management, Comcast is essentially a silent partner.

The latest indication that Hulu is looking to sell itself is that it has reached tentative agreements with Disney and News Corp. to renew contracts that will keep content from the two entertainment conglomerates on its site. Industry observers see these deals as window dressing for potential buyers.

Comcast, which acquired its stake in Hulu when it took control of NBCUniversal, agreed to take a hands-off approach to the online video distributor in return for of the deal. At the time, there was great concern about what Comcast's acquisition of NBC would mean for the future of Hulu. Many , lawmakers and media watchdogs feared that Comcast would view Hulu as a competitor to its own cable distribution platforms and try to squash it.

Indeed, in the consent decree approving the deal, the government said, "Comcast has an incentive to prevent Hulu from becoming an even more attractive avenue for viewing video programming because Hulu would then exert increased competitive pressure on Comcast's cable business."

When it signed off on the deal, the government essentially told Comcast that it could retain its stake in Hulu but also had to give up its voting rights and board representation. Comcast was also made to provide programming to Hulu on the same terms as the other owners. Since Disney and News Corp. have agreed to renew their deals with Hulu, Comcast will also now do the same because of its arrangement with the government.

Since its hands are tied, Comcast will have little say in any sale of Hulu, and yet could find itself having to go along with a deal that could put the website in the possession of a potential competitor. Whereas News Corp. and Disney do not own cable systems or have broadband operations, Comcast does, and it is likely to be wary about Hulu ending up with a firm such as Google Inc. or Yahoo Inc. or another big cable distributor, especially if it has to provide content to a rival.

Whoever buys Hulu probably would insist on having long-term programming commitments from the current owners. Comcast would presumably have to sign such an accord as well.

Explore further: DOCOMO and Huawei confirm LTE network over unlicensed spectrum

not rated yet
add to favorites email to friend print save as pdf

Related Stories

A look at possible conditions in Comcast, NBC deal

Dec 13, 2010

(AP) --Federal regulators are considering a number of conditions to ensure that Comcast Corp. cannot use its control over NBC's vast media empire to stifle the growth of online video. Their key concerns:

Hulu mulls putting itself up for sale

Jun 22, 2011

(AP) -- Online video service Hulu is exploring putting itself up for sale after receiving an unsolicited takeover offer, people familiar with the matter said Tuesday.

'Daily Show,' 'Colbert' to return to Hulu

Feb 03, 2011

(AP) -- "The Daily Show with Jon Stewart" and "The Colbert Report," which have been absent from online video service Hulu for almost a year, are back on the free service.

Disney joins NBC and News Corp. with Hulu stake

Apr 30, 2009

(AP) -- The Walt Disney Co. is taking a stake in Hulu.com. This means titles from The Walt Disney Studios library of films and full-length episodes of ABC television shows will join the online video site.

FCC seeks more info from Comcast, NBC Universal

Oct 04, 2010

(AP) -- The Federal Communications Commission is requesting additional information from Comcast Corp. and NBC Universal as it reviews the cable operator's plan to acquire a controlling stake in the media company.

Comcast to debut cable shows online by year's end

Oct 20, 2009

(AP) -- You'll be able to watch popular cable television series such as HBO's "Entourage" and AMC's "Mad Men" on your computers by the end of the year without paying extra - as long as you're a Comcast Corp. ...

Recommended for you

Bringing emergency communications together

Aug 21, 2014

A new University of Adelaide research project aims to improve emergency operations through integrated communications systems for police and the emergency services.

For top broadband policy, look no further than Canada

Aug 20, 2014

You might have seen communications minister Malcolm Turnbull raising the issue about Australian press not discussing policy problems and solutions from overseas, in a speech delivered at the Lowy Institute Media Awards last week: ...

Cities, states face off on municipal broadband

Aug 19, 2014

Wilson, N.C., determined nearly a decade ago that high-speed Internet access would be essential to the community's social and economic health in the 21st century, just as electricity, water and sewers were in the previous ...

New loss mechanism for global 4G roaming

Aug 19, 2014

A loss mechanism that has not been an issue in previous mobile handset antennas will become important for global 4G roaming, according to results of experiments carried out in Aalborg, Denmark.

User comments : 0