Though Hulu's owners and directors weren't satisfied with bids from big players like Yahoo, DirecTV and Amazon and ended up scrapping their plans to sell the company, that doesn't mean they're resting on their laurels. The various figures in control of Hulu are considering an initial public offering, putting the three-year-old company in direct competition with other premium video services. Hulu tried an IPO last year when it was evaluated at $2 billion, but plans fell through.
An IPO would be odd for such a young company - for example, the earliest estimates for a Facebook IPO are hovering around 2013. That says nothing of Hulu's unusual structure: the company is jointly owned by News Corp (Fox), Disney (ABC), and Providence Equity Partners, and run by its own directors and executives. That said, t might be just the ticket for a relatively small company competing in a hot market. An infusion of cash could help it stave off aggressive moves from Netflix and Amazon, while still keeping its options open for another sale opportunity further down the line.
Make no mistake: Hulu is a solid monetization strategy for its owners' and partners' content. Even though it offers free movies and TV shows (unlike Netflix and Amazon) it makes money off of them, and brings in bonus revenue from subscribers who want to access a deeper library and apps on iOS, Android and connected TVs. Whether the company can stand up in the face of its competitors - and in at least some cases, the dueling wills of its owners - remains to be seen.
Fox recently decided to delay all of its first-run shows by eight days unless Hulu users pay the subscription fee, unsurprisingly causing a boom in piracy of the effected shows. Hulu's content, like Netflix's, is in a constant state of flux, sometimes causing shows to come in and out of availability and frustrating users. There's still a lot of growing pains for the legitimate video streaming market - not to mention a lot of opportunity for whoever gets it right.