Roku (ROKU 4.27%) is considering becoming the next streaming video provider to get into the content creation business, reports online trade magazine Digiday. According to the usual "people familiar with the matter," the company has spoken to media and entertainment companies about producing its own original programming. The talks are said to be at an exploratory stage.
Rumors have surfaced on previous occasions that Roku was considering producing content for its video streaming platform, but nothing came of them. In this case, Roku has issued a statement saying "We aren't creating any original shows and don't have any plans to do so." Digiday, though, notes that Roku didn't deny that it had had those talks with content producers.
Image source: Getty Images.
If Roku does get into original programming, it would be another evolutionary shift for the company, which began as a simple streaming device manufacturer. Today, it hosts its own channel while serving as a portal for other streaming services, a change that allowed Roku to begin selling advertising, which now accounts for the lion's share of its $1 billion in annual revenue.
It has also partnered with smart TV manufacturers to embed its operating system in their sets. Now, one out of every three smart TVs sold is a Roku smart TV. There's also Roku-branded sound equipment. Although adding exclusive original programming to the mix would seem like a natural progression, that would be an expensive undertaking. Both Netflix and Amazon spend billions of dollars annually creating content, and others such as Walmart's Vudu streaming service have begun to produce original movies too.
With the field growing increasingly crowded, Roku may decide that simply facilitating the distribution of streaming services is the best, most profitable use of its technology and time.
