SAN FRANCISCO — Apple is in talks to potentially bid for video-streaming service Hulu, a person close to the situation said Friday.
The person, who said Apple is among several companies interested in Hulu, asked not to be identified by the Associated Press. In early July, search giant Google was said to be among about a dozen companies in talks to potentially buy Hulu. Yahoo is also believed to be interested.
Hulu — owned by the Walt Disney Co., News Corp., Comcast and Providence Equity Partners — started presenting its financial information to interested bidders late last month, after an unsolicited offer prompted its board to look for other offers.
The online video service streams movies and TV shows from broadcasters ABC, Fox and NBC to computers and — for a monthly fee — to a number of Web-connected mobile devices such as smart phones and tablet computers. It expects its paid service, Hulu Plus, to have more than 1 million subscribers by the end of the summer, and its chief executive officer, Jason Kilar, has said it is profitable.
For Apple, an acquisition of Hulu could bolster its iTunes store, which provides videos that users can rent or buy but does not currently stream content or offer a subscription streaming service. Buying Hulu could also help the iPhone and iPad maker as it spars with competitors such as online video pioneer Netflix, which offers both a DVD-by-mail and a video streaming service, and Google's popular YouTube video streaming site, which streams free, ad-supported videos and rents movies from several major studios.
If Apple — or any other company — were to buy Hulu, there's no guarantee it would be able to continue streaming content from the company's current owners. A buyer may have to reach a new deal to license the content.
Forrester Research analyst James McQuivey said the key to any deal involving Hulu would be an agreement for the continued streaming of its current video content. And if, as many analysts expect, Apple is developing its own TV set, the addition of Hulu would put the company in an "amazingly powerful position," he said.
Hulu isn't interested in just exploring possible offers. Earlier this month, Disney chief executive officer Bob Iger told reporters that Hulu's owners are "committed to selling."
BGC Partners analyst Colin Gillis said that since part of Hulu's business is ad-supported, it's contrary to Apple's current model of buying or renting videos. It makes more sense for Google or Yahoo to buy Hulu, he said.
"They're not the most logical buyers," Gillis said of Apple. "Maybe peeling off a couple bills to keep it out of the hands of Google makes some sense."