American online media provider Hulu is a popular website that offers viewers access to TV shows, movies, and so on. Subscribers can watch episodes of their favorite shows a day after they have been aired on the local TV channels.
Time Warner sets sights on Hulu
Hulu services are offered to subscribers in Japan and the US. Due to its rising popularity and increasing demand, Hulu has caught the attention of one of the largest media companies in the world – Time Warner. The companies have been in negotiations since late 2015. Time Warner is looking to take a bite out of Hulu and become a part owner. The giant is eying a 25 percent equity stake in the online provider.
Time Warner on Hulu’s “cord cutting”
Hulu allows its subscribers to watch their favorite shows and documentaries from the first episode, even if the show has progressed into the season on television, unlike its rivals Netflix and Amazon.com, which offer their viewers access to the earlier episodes only after the end of the season or much later. The free-range access has Time Warner’s gears grinding because the company believes that access to full seasons and current seasons on Hulu, or elsewhere apart from pay-TV, is causing harm to the producers and owners of the series as it will lead to people disconnecting subscriptions to pay-TV, or as the media refers to it, “cutting the cord.”
Along with acquiring the 25 percent stake, Time Warner has also demanded that episodes of current seasons be removed from their services. This is, however, not a part of the investment. The company announced that in the long run, it wants to reconstruct the marketplace of online media to be able to support pay-television. One approach suggested by Time Warner was to have current seasons placed behind a paywall, which would be accessible only to pay-TV subscribers.
The owners of Hulu do not have any plans of removing current TV shows off their platform for now, but it has been revealed that it is an open question in the longer term. This factor has caused Hulu to delay finalizing agreements with other companies and also licenses. The website has also struck deals for old TV shows, which has reduced its dependence on current seasons.
It is not clear if the talks between Time Warner and Hulu will successfully progress as the demands made by the former can put Hulu’s current co-owners in a twist.