Yahoo Hulu Bid Between $600M And $800M, Sources Say

Yahoo Hulu Bid May Go As High As $800M

The Yahoo Hulu bid filed on Friday now has a price tag, and it’s between $600 million and $800 million, according to a report from All Things D.

A $200 million swing is bound to raise questions, but keep in mind, this is not a package of beef jerky. This is a deal worth close to $1 billion with multiple investors and media companies involved. The range is to cover a number of configurations depending on length of the licensing rights and how much control the existing owners will have over their content.

Those existing owners/content providers include Walt Disney, Comcast, News Corp, and NBCUniversal, each one a major player, who wouldn’t be hesitant to squeeze Yahoo’s margins should they win the deal.

While a Yahoo Hulu bid makes a lot of sense at this point, what makes less sense is the recent $1.1 billion valuation that Yahoo gave to Tumblr when it acquired the blogging service earlier this month.

According to Business Insider, Tumblr made only $13 million in 2012. Meanwhile, Hulu’s monthly revenues are based on four million subscribers, who pay $7.99 per month for a shade under $32 million per month in subscription revenue.

In 2012, the TV streaming service brought in $695 million.

The math makes the Tumblr transaction seem purely speculative, but then maybe someone who’s taken the GMAT can weigh in.

Of course, Yahoo isn’t exactly the only bidder vying for Hulu’s hand. Others include Time Warner Cable, DirecTV, News Corp president Peter Chernin (whose offer included $500 million plus an undisclosed sum for dealing with Hulu’s debts), and private equity firms Guggenheim Digital Media, KKR, and Silver Lake Partners.

Here’s a bit more on the battle ahead:

Amazon was reportedly interested in the company at one point, but, as of Friday, sources have indicated they are no longer in pursuit.

Do you think the Yahoo Hulu bid is the right price? Of those courting the streaming service, which company would you like to see in charge?

[Image via Flickr Creative Commons]