From the moment it first launched, Hulu has rapidly reimagined the way we watch television online. But those gains in popularity -- and shifts in behavior -- often came at the expense of the content creators who supplied it.
As such, the site -- which is owned by the Walt Disney Co., News Corp. and Comcast -- is both a blessing and a curse for its corporate owners. The question is whether it will do more damage in their portfolio or someone else's.
The Wall Street Journal reports that Hulu "plans to meet with a range of potential buyers in coming weeks" after a bid from Yahoo piqued enough interest to consider selling the property. (Disclosure: ZDNet's parent company, CBS Corp., owns rival TV.com.) But will its owners also give up control of this new landscape, too?
The key phrase at the center of all things Hulu: "business model." Like any new technology, Hulu undercuts an established industry -- in this case, broadcast television. TV has been a very profitable business for a very long time, with an established (and occasionally precarious) balance between the studios that produce the content, the broadcast companies that distribute it and the cable companies that carry it.
Hulu is effectively a wrench in the oiled gears of this machine, which begs the question: can you innovate and preserve your cash cow at the same time?
Can you have your cake and eat it, too?
The worry is that a sale would just give the competition more ammunition to undermine the status quo. By dealing Hulu away, its owners lose the chance to replace one revenue stream with another -- even of they don't want to do so in the first place.
On the other hand, if Hulu's owners sufficiently stifle development of the site because they're too concerned with hanging on to their existing (lucrative) business, it's possible that another more aggressive competitor will rise up -- undermining their business once more. Only this time, it's without the benefit of Hulu's owners profiting from it.
When it comes down to it, it's a matter of leadership and vision. Chief executive Jason Kilar has pushed Hulu's corporate owners to narrow the exposure of their content on competing services such as Netflix and funnel more of it through a single site -- Hulu.
But some of those other services pay more than Hulu, and it's hard to say no to more money. Kilar clearly has a strategy, but if corporate won't give him the room to execute -- much less the time -- it's D.O.A. no matter how you cut it.
The underlying question is whether we'll continue live in a world where content comes through a centralized portal, or whether we'll begin to subscribe to content from the creators themselves: NBC for NBC, ESPN for ESPN, and so forth. My money's on the latter, but that's not a comforting picture to shareholders.
Either way, it's a tough situation for Hulu's owners: do you give the bomb to your enemies, or hang on to it and risk blowing yourself up?