On Wednesday rumors swirled that Netflix may be considering acquiring Roku which led to speculation on how a possible merger may change the way people stream.
According to Business Insidersources close to the situation at Roku said the company has been discussing the potential move in “recent weeks”. The possible merger comes after Roku’s market value has dropped approximately 70 percent in the last 12 months.
Unnamed sources reportedly told Business Insider that they’re speculating the company is about to make a big move because Roku closed the trading window available for employees.
Companies often will prevent employees with private information from buying or selling their stock before a significant announcement to avoid insider trading or a drastic change in stock price.
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However, this rumor is pure speculation as neither company has confirmed the discussions Business Insider reported on. Roku declined to comment on the speculation. We reached out to Netflix for comment.
But that has not stopped people from dreaming of a collaboration between the two tech companies.
Roku is a digital media player company that uses advertisement-supported streaming for the Roku Channel. Consumers who purchase a Roku TV are offered a variety of free channels so long as they watch advertisements, or they can stream using their favorite platforms.
Netflix is a streaming service that is subscription-based although the company has recently faced backlash for raising subscription costs and introducing the idea of advertisements. The streaming platform has seen a lull in subscribers and reported sluggish quarterly earnings.
Some theorized that if the two were to merge, the companies could collaborate on a Netflix-specific TV or remote. But mostly Netflix could benefit from Roku’s advertisement-based support system which the company has expressed interest in.
However, others believe the speculation is just that, noting the two business models are different and Roku adopting Netflix’s subscriber-base model would not make sense.
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