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By Leena Rao

According to a Reuters report, Hulu is preparing to IPO in the first half of 2011. Sources told the news organization that Hulu will be looking to raise between $200 million and $300 million in a deal valuing the company at about $2 billion. Reports about Hulu’s IPO ambitions first surfaced last summer, but this may signal that a filing might be imminent.

Hulu is expected to file with the Securities and Exchange Commission before the end of the year, which will set the company to IPO anywhere between January and May of 2011. Reuters’ source says the offering is “contingent on the renewal of rights to carry shows, some of which expire in a year.”

This is probably another way that Hulu is testing the waters for an IPO. While the company may claim high revenues ($100 million in 2009), it is still not clear how profitable Hulu can be, or how viable its long-term survival will be. Hulu already has to fork over as much as half or more of its advertising revenues to its TV network partners/backers (Fox, NBC, and ABC).

Hulu just launched its paid service, Hulu Plus, an ad-supported, premium subscription service that will run $9.99 per month and includes HD access to full season runs of shows from Fox, ABC, and NBC. This could end up bringing in revenue and profits, but initial reviews of the new service have not been entirely positive.

And there are other chinks in Hulu’s armor. You can’t watch CBS (NYSE:CBS) shows on Hulu, and earlier this year Viacom (NASDAQ:VIA) decided to pull its most popular shows from Comedy Central. And Comcast (NASDAQ:CMCSA) has its own plans for streaming TV on the Web, probably involving its new purchase, NBC.

Competition is also increasing for Hulu, which has always had a longstanding rivalry with Netflix (NASDAQ:NFLX). With Google TV (NASDAQ:GOOG) and Apple TV (NASDAQ:AAPL) both playing in the same space, Hulu is going to be facing more competition for viewership.

So really, until we see the actual filing or financials, it’s difficult to tell how profitable Hulu really is.

That being said, Hulu is dominating video advertising. According to recent comScore reports, Hulu is generating nearly 800 million ad impressions per month, even more than YouTube (this measurement doesn’t take into account other types of advertising like overlays, banner ads).

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Source: Hulu Reportedly Prepping for $2B IPO