Roku adds 23 more Quibi shows as it pursues original content strategy

The Roku IPO on the Nasdaq, September 28, 2017.

Supply: Nasdaq

Roku mentioned Monday it can add 23 extra reveals to its assortment of “originals” because it tries to construct on its ad-supported content material technique.

The reveals embody extra of the content material it purchased from the now-defunct streaming service, together with 4 that had by no means aired. Roku mentioned in January it had acquired the rights to greater than 75 reveals from Quibi. It debuted 30 of them in Could.

New reveals embody the 10-part docuseries “What Occurs in Hollywood,” and “Eye Sweet,” a contest sequence hosted by Josh Groban. The reveals will stream starting on Aug. 13 within the U.S., Canada and the U.Ok. 

The corporate licenses content material from different media firms and has purchased reveals, together with “This Previous Home,” which it acquired earlier this 12 months, for The Roku Channel. It generates income by promoting advertisements in opposition to the programming.

Needham analysts mentioned in a observe final week that Roku’s content material objective is to take care of an ad-supported video-on-demand enterprise mannequin with out negatively impacting gross margins from content material creation. 

The Roku Channel “continues to broaden its attain by rising niches,” the analysts wrote. “Complete streaming hours doubled at [The Roku Channel] in 2Q21, pushed by its flywheel of making new Roku originals, which results in extra viewing hours, which attracts new advertisers, which drives larger advert revs, which Roku invests into new authentic content material, and so forth.” 

Needham mentioned the originals are attracting new advertisers to Roku. 

Evercore ISI analysts mentioned they count on Roku to proceed to be opportunistic in shopping for content material to seize extra related TV advert budgets. 

“However we additionally imagine these investments ought to function a robust moat of product differentiation which will nicely result in superior pricing energy for Roku over time,” they wrote. 

Roku reported second-quarter earnings final week that beat expectations however confirmed streaming hours within the quarter decreased by 1 billion hours from the primary quarter of 2021. The corporate mentioned “tight part provide circumstances and transport constraints” continued growing prices sooner than anticipated.

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