Hulu IPO on hold (for now)
As Hulu executives chart the evolution of the online video service, the idea of raising money through an initial stock offering appears to be on hold — at least for now, say people familiar with the matter.
The service accomplished its initial goal: to offer Web users a way to watch a broadcast television show they missed without resorting to piracy. Last summer, Hulu launched a subscription service that delivers current and classic TV shows to new devices, including game consoles and Apple Inc.'s iPad, which broadened its reach and opened up a second source of revenue (it recently cut its subscription price).
Hulu Chief Executive Jason Kilar said last week on CNBC that Hulu would end the year with $260 million in revenue, beating its initial $190-million projection. The service, which has said it's in the black, has never broken out profits.
Now, Hulu executives and board members are weighing next steps for the service and whether it needs to acquire more content to compete with rivals such as the fast-growing Netflix. The direction will dictate Hulu's capital needs, said one person with knowledge of the situation.
One issue being debated is whether Hulu should increase the number of ads to boost revenues.
Such discussions will determine whether Hulu's deep-pocketed owners — which include media giants News Corp., the Walt Disney Co. and NBC Universal — would provide more funding, or if the service needs to seek outside investors, said the person.
The Wall Street Journal reported that a potential Hulu IPO is on the back burner.
A Hulu spokeswoman declined comment.
— Dawn C. Chmielewski
Photo: Hulu CEO Jason Kilar. Credit: Gary Friedman / Los Angeles Times.