Yahoo’s Hulu Bid Validates Former CEO’s Strategy

In bidding for Hulu, Yahoo CEO Marissa Mayer is taking a page from former interim CEO Ross Levinsohn’s playbook. She’ll be going up against Levinsohn for the second time, as he too is bidding for the online video site. posted on

Yahoo vs. Guggenheim for Hulu should be interesting... Marissa vs. Ross, the rematch.

During his brief run as Yahoo’s interim CEO, Ross Levinsohn sought to end the everlasting debate over whether Yahoo was a technology or media company by focusing on content it could sell ads around.

Levinsohn, who had previously run digital operations at News Corp’s Fox Interactive Media, had a decisively media and content-centric background. He lost out in his campaign to become Yahoo’s permanent CEO to Marissa Mayer in part because she won over the board with her product-centric vision for the company. But now, according to AllThingsD, Yahoo has bid between $600 million and $800 million for Hulu, validating Levinsohn’s view that content — video content in particular — is a play worth making for the company. It also demonstrates a willingness of Mayer, who has spent much of her time revamping Yahoo’s products, to make significant investments in content.

It also puts Mayer back in competition with Levinsohn, who is bidding for Hulu in his capacity as CEO of Guggenheim Digital Media. Yahoo took a hard look at picking up Hulu while Levinsohn was EVP of Americas in 2011.

The reason for the wide price range, according to AllThingsD, stems from the length of Hulu’s licensing rights for content and how much control the programming companies selling Hulu have over their media. For the buyer, Hulu’s continued success is going to depend on the kind of content licenses it has with companies like owners Disney and News Corp. (Comcast also owns a stake in the site.)

Or, put another way, the kind of deals Levinsohn, unlike Mayer, is well versed in negotiating.

But Mayer’s intent to find a place in video — one of her so-called “daily habits” — was pretty clear after Yahoo aggressively bid but eventually lost out in an attempt to acquire Dailymotion, a French startup that hosts video content online.

There are many other video platforms on the Web other than Hulu for Yahoo to chase, but its audiences and content licenses are what separate it from the rest.

If Mayer is to follow her $1.1 billion Tumblr deal with a Hulu purchase, however, she will need to beat out more than just Levinsohn. Other companies bidding on Hulu include Time Warner Cable, DirecTV, former News Corp president Peter Chernin, and talent agency William Morris Endeavor in partnership with SilverLake Partners.

Check out more articles on BuzzFeed.com!

Facebook Conversations
          
    Now Buzzing