New York-based media company Time Warner now holds a 10-percent stake in major streaming TV and movie company Hulu.
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Details of the investment were not disclosed but some reports said Time Warner was investing some Dollars 580 million, which would value Hulu at close to USD 6 billion.
The streaming TV service Hulu is gaining a fourth parent: Time Warner, the parent of CNN. In May, the company confirmed rumors that it would be launching the service and that it would be a standalone offering not requiring consumers to pay for a cable subscription.
An exact release date and pricing for Hulu’s new live streaming service have not been announced yet, but the platform is expected to launch in early 2017. The new Time Warner deal secures live and on-demand content from Turner’s networks, including TNT, TBS, CNN, Cartoon Network, Adult Swim, truTV, Boomerang and Turner Classic Movies.
Those opportunities include the purchase of Hulu, a joint venture owned by Walt Disney, 21st Century Fox and Comcast. Revenues fell 5 per cent to $7 billion.
Its partnership with Hulu, a video company that competes with Netflix, calls for Time Warner’s “full suite of networks to be carried on Hulu’s live-streaming service” that will be launched next year, Time Warner CEO Jeff Bewkes said in a statement.
The company posted second-quarter earnings per share of $1.29, compared to $1.25 per a share in the year-earlier period. Those three owners were already working with Hulu this year about including some of their programming in the separate live-TV service.
Shares closed down about 1.3% on Tuesday but added almost 3% in Wednesday’s premarket action, trading at $78.00. The Hulu investment is a good opportunity for Time Warner to move more aggressively into streaming, but it’s also an investment in a competitor.
Time Warner said that that the investment is part of its effort to offer innovative digital services, giving its customers alternative platform to access high quality content.
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The company raised its 2016 earnings forecast by 5 cents a share to a range of $5.35 to $5.45.
