What They Say
Last week there were rumours that Roku was to be bought by Neflix. Commentators speculated that Netflix could use such an acquisition to accelerate its expected advertising-subsidised membership plans. From Roku’s point of view, the rumours boosted the company’s stock price.
What We Think
I think the best analysis that I saw of this rumour pointed out that Roku actually makes a significant part of the advertising revenue for the rivals of Netflix and dropping that would damage the value of Roku. Roku has also been mainly successful in the US and so might not help Netflix so much in Europe, for example. My feeling after reading a few commentaries is that the deal is not likely to happen. As was suggested in one analysis, Sony might be a better buyer of Roku to use its operating system to run its Smart TVs. (BR)
