Conflict of Interest: Hulu iPhone App On the Way

Rumor has it: Hulu is hard at work on an iPhone app that will allow iPhone denizens to play Hulu content on their hand held devices. This app might put a dent into mobile content offered on iTunes. Read up:

Hulu is in the process of developing an app for Apple’s (AAPL) iPhone and iPod touch, we have learned from a plugged-in industry executive. The app is coming soon (within a few months) and is “badass” — as excellent as Hulu’s Web site. Video will work over both wi-fi and 3G, we’re told.

It won’t be the first Web video app for the iPhone — CBS’s TV.com app is on the market, as are Joost, i.TV and several others — but it could be the best. Hulu’s tech and design teams have demonstrated themselves as the best in the Web video industry, as everyone is now trying to emulate them. One hurdle, we assume: Because of Hulu’s streaming architecture, it might not be possible to download videos to watch later, such as on the subway or an airplane.

Apple will still need to approve the app before it is offered officially. On one hand, allowing the app would sell more iPhones but on the other it directly competes with iTunes. It will be interesting to see how Apple plays that one out. Tip of the hat to Silicon Alley Insider.