As you might think after a big acquisition companies might want to hold back on the spending for a while to keep the accountants happy, not Yahoo. Reports have said that they are willing to pony up $800 million to acquire Hulu a video streaming site which is currently owned by Disney, Fox and NBC Universal.
The acquisition of Tumblr was to bring Yahoo a demographic; the company is going through a series of drastic changes at the moment. Yahoo has cut services that aren’t bringing in much traffic to the site; Yahoo has also released their own search, mail and weather apps for iOS and Android. These are all moves to bringing in more users and the acquisition of Tumblr and Hulu will help that happen.
Hulu is only as valuable as the content licenses that are signed over with the company; the exclusive content is why Hulus users pay their monthly subscription fee. Services like Hulu are very popular amongst the cable-cutting portion of society that doesn’t want to pay for channels that they won’t watch.
Hulus users are attracted to this service because they get access to the content the day after it airs on TV; if the content licenses that are granted state that Yahoo has to wait longer before they publish the content then they will lose a large portion of their users.
Source – VentureBeat