Speaking today alongside Time Warner CEO Jeff Bewkes during the company’s second-quarter earnings call, HBO CEO Richard Plepler said his unit has had “constructive conversations” about including HBO in the live Hulu, as well.
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The company is paying about $580 million for the Hulu stake, sources told tech site Recode. Since its launch in 2008, Hulu has been at the forefront of entertainment and technology and continues to redefine TV by connecting viewers with the stories they love.
Revenue at HBO was up 2 percent to $1.5 billion, with Game of Thrones, Silicon Valley and Veep each growing viewership by double-digits courtesy of HBO’s digital platforms.
The development makes Time Warner “an official member of the “cool kids” club, ‘ ” Todd Juenger, an analyst with Sanford C. Bernstein, said in a research note. At the same time, it says its portfolio of cable channels including CNN will be available live on Hulu’s live streaming service. Hulu will stream TNT, CNN Cartoon Network and other Turner Networks on demand and live on its new live streaming service that’s set to launch next year.
Hulu has not confirmed many details on the service, although it is believed to cost around $40 per month.
The company, which plans to roll out the new live TV bundle of broadcast and cable network channels early next year, has one of the industry’s highest customer defection rates at 50%, according to research firm Parks Associates.
None of which, of course, has been lost on Time Warner, whose entrance into the online market has been extremely slow.
Time Warner past year moved into video streaming by launching the stand-alone HBO Now service. In the same period a year ago, the company reported EPS of $1.25 on revenues of $7.35 billion.
The company saw a 6 percent increase in ad revenue, coupled with a 11 percent rise in fees paid by distributors.
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In a separate announcement, Time Warner raised its full-year adjusted EPS guidance of $5.35 to $5.45, compared with the consensus estimate of $5.39. Hulu’s other equity stakeholders include Walt Disney, 21st Century Fox and Comcast’s NBCUniversal – the parent companies of ABC, Fox and NBC.
