Rumors Grow About a Possible Netflix Acquisition of Roku
If the rumors are to be believed, Netflix is about to acquire Roku, and with it secure its own range of media streaming devices as well as a growing ad business.
As Business Insider reports(Opens in a new window), employees at Roku believe an acquisition is imminent. Over the past year the company’s stock price has dropped 80%. Combine that with weaker demand for streaming devices/services, and Roku’s management recently closing the trading window for employees with vested stock, and you can start to see why.
Netflix buying Roku is apparently being viewed as a positive move by people in the industry. The huge drop in stock price makes Roku relatively cheap to acquire at a valuation of under $13 billion, but it’s the company’s ad business that is being viewed as the main draw. It generated $647 million during the first quarter, and would allow Netflix to more easily introduce and quickly scale an ad-supported streaming subscription.
