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DirecTV has the edge right now among bids to buy Hulu

Satellite television provider DirecTV appears to have the leading bid for video streaming service Hulu, according to sources familiar with the sale process.

Other contenders include Guggenheim Digital Media and a joint bid from the Chernin Group and AT&T, the sources said. Final, binding offers for Hulu had been due today, but the deadline has been extended to Tuesday, in part to give DirecTV more time to assemble its acquisition package.

The competition for Hulu, which wasn’t able to fetch significant offers when it first went up for sale in 2011, demonstrates how various segments of the media industry suddenly see value in owning their own platforms. Hulu has about 4 million subscribers paying about $8 a month for a mix of movies, TV shows, and original content. It also offers some video for free.

Sources say DirecTV has an advantage because, as one of the largest multi-system operators (MSOs) in the United Sates, it’s already a major customer of Hulu’s owners—Disney, Comcast, and News Corp. DirecTV could use Hulu to diversify its offerings or even to create a cable service delivered entirely over the internet. It currently operates over satellite as well as the web.

But the Chernin Group, led by former News Corp. president Peter Chernin, and Guggenheim, headed up by former Yahoo interim CEO Ross Levinsohn, are seen as more entrepreneurial. That could help ease concerns about Hulu losing its innovative spirit and strong engineering team if it were sold to a corporate buyer like DirecTV.

Hulu owners are hoping to fetch a price in the $1 billion range and if they don’t get such offers, they may rethink a sale, sources said. But at least some of the bids are expected to hit that price range, sources said. Yahoo, Amazon, and private equity firm Silver Lake also considered separate bids for Hulu, but their interest has waned, sources say.

There’s also still a possibility that Hulu’s owners avoid an outright sale by bringing in another media company such as Time Warner Cable or Time Warner, through an investment. Some analysts have advised against selling. Part of the reason Hulu is on the block, though, is that its owners have disagreed over what strategy to pursue.

Hulu declined to comment.

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