• by Wayne Friedman , Staff Writer, January 11, 2022

There was a point in Netflix’s business evolution -- maybe around 2015-2016 -- when some analysts still believed traditional media could ramp up and overtake the streamer. They thought the growing subscription video-on-demand provider was going to be an afterthought in the digital video world.

Six years later, critics were wrong.

Netflix has succeeded in becoming equal to or better than what many had anticipated, including maintaining dominance over legacy media companies’ streaming efforts.

We are now at a similar inflection point for Roku -- where many analysts believe legacy digital media companies such as Google and Amazon, as well as legacy TV manufacturers, Samsung, Vizio, or others in the smart TV/video streaming distribution space could overtake Roku.

All that has hit Roku’s stock price hard -- down 75% over the most recent 12-month period. Roku continues to have a strong 56.4 million monthly active users. Competitor Amazon Fire TV is close behind.

But looking forward, where will Roku's new growth come from? One key question is international.

Netflix stressed this some years ago, realizing that growth among the U.S. subscribers would slow down. (It has.) Netflix then emphasizes that global subscribers would be the key metric to follow. Business analysts did just that.

Should Roku follow in those international footsteps? It has begun some efforts. Recently, the company expanded into Germany, with plans to enter Peru and Chile later this year.

Indeed, it seems Roku will pursue this path. But there are other paths perhaps higher on the list -- that include advertising, as well as its platform sales. This is something the company puts much time and effort into, especially around The Roku Channel, and its demand-side platform OneView.

Some years ago, while analysts were ruminating about Netflix's prospects, they prophesied Netflix should offer an advertising option, a business idea that faded over time.

For Roku, many suspect it could soon be a target of a potential acquisition by any big media company. Of course, analysts suggested the same thing for Netflix years ago.

Look for another business story line and/or fade-out to come.