But what about modest wannabe players, who look to bridge different parts of the TV-streaming industry spectrum -- like Roku? Perhaps it will take some lessons long-learned by Charter Communications, Verizon, T-Mobile, and AT&T. Stay in your lane.
After years of unimpeachable growth, analysts believe Roku, the streaming-video distribution platform and set-top-box company, could be slowing down -- big time.
This now comes with a slowdown in TV sets and set-top-box streaming unit sales -- mostly pegged to what are considered to be temporary supply-chain shortages. But other analysts see the future where Roku will have to shift gears. And that's where potential problems lie.
Roku continues to tout ever higher impressions -- especially on its Roku Channel, where it “monetizes” much of those impressions via advertising revenues. But eventually those impressions will rely on new original content -- not just library programs.
Beyond a modest deal to acquire the defunct Quibi TV original series content -- and a deal to briefly take over the canceled NBC cult-favorite show, “Zoey's Extraordinary Playlist” -- analysts believe new content might be lacking.
MoffettNathanson Research warns: “We believe the future of Roku's monetization will be driven by their ability to grow ad impressions on The Roku Channel, which will be challenged by the massive surge in original content from all corners of the streaming world in the years ahead... We are now seeing real content investment and advertising prioritization in that arena from a wide list of better-resourced programmers.”
Roku might not be alone. Take Paramount Global's Pluto TV and Fox Corp's Tubi -- two free advertising-supported platforms, somewhat similar to The Roku Channel. There is lots of library programming on all these platforms.
So far these channels don’t have any standout programming yet -- although executives promise new stuff is coming. Still, one can't imagine these would come at the expense of higher-profile programming for sister companies' bigger and seemingly more important streaming services.
To be clear, pushing along Pluto TV and Tubi is a key revenue piece, when it comes to advertising-revenue generation for Paramount and Fox, respectively.
Major advertisers can make package deals with legacy, linear TV networks. That's not a resource Roku has.
That said, Roku intends to ramp up content investments. But to what level?