Apple mulls bid to acquire digital video service Hulu

Apple (NASDAQ:AAPL) is reportedly considering making a bid to acquire digital video service Hulu, with sources telling Bloomberg that the two companies are currently in the early stages of negotiations.

Hulu, owned by media conglomerates News Corp., Disney and Comcast, touts ABC, Fox and NBC programs including Modern Family, The Office and Glee, series or season runs of past favorites like Arrested Development and The X-Files and a catalog of feature films. Acquiring Hulu would give Apple a popular new subscription service spanning both mobile and desktop platforms: "Part of the ecosystem of Apple's future is to include more video," said Wedbush Securities Inc. analyst Scott Sutherland. "It's something they are focused on."

Bloomberg and SNL Kagan forecast Hulu's price tag could surpass $2 billion. Apple--now the world's second most-valuable company--recently said it has $76.2 billion in cash and securities on its books. Both Apple and Hulu declined to comment on the reports.

Hulu's digital audience tops 28.5 million users per month, with mobile apps available for Apple's iOS and Google's (NASDAQ:GOOG) Android. However, the service is a source of discontent to cable and satellite providers who pay programmers $30 billion a year for the rights to broadcast programming viewers can check out online or on mobile devices for free via the ad-supported service.

Although Hulu offers an ad-free premium version, dubbed Hulu Plus and priced at $7.99 per month, reports indicate Hulu board members have clashed with CEO Jason Kilar over the number of ads run in each free program and the cost of Hulu Plus membership.

For more:
- read this Bloomberg article

Related articles:
Hulu Plus rolls out to Android as sale rumors escalate
Hulu Plus coming soon to Android 2.2 smartphones
Hulu primping for $2 billion IPO
Hulu launches multi-platform premium video service
Hulu poised to debut premium service on iPad, Xbox