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Börse Express – Roku's television strategy takes the company to the next level



The streaming provider Year (WKN: A2DW4X) says that every third Smart TV sold in the US in the first quarter was installed on Roku OS. These sales of smart TVs also included streaming packages and decoders, and as a result Roku managed to capture 30 percent of the overall streaming market in the first quarter, according to Strategy Analytics.

Strategy Analytics analysts also point out that Roku TV's distribution has helped to extend its edge over streaming devices to competition. And lead is anything but short.

Roku provides 15.2% of all streaming devices used in the United States. This is a 36% advantage over the nearest PlayStation rival Sony, Sony, Samsung and Microsoft they are all close to each other and behind them alphabet Google and Amazon (WKN: 906866).

Source: Strategy Analysis, Business Tel

Although all of the above mentioned companies pose a competitive threat to Roku, Smart TV partnerships should enable the company to further expand its potential.

Smart TVs are trending

About half of 29.1 million active Roku users are Roku TV users, according to estimates by Needham analyst Lora Martin. This rate is expected to continue to increase in the coming years as Roku TVs continue to gain market share.

Total Smart TV sales have reached a new record in the first quarter, according to Strategy Analytics. This means that the need for a connected device, such as a Roku box or a fire bar, falls. It is important that Smart TVs take a higher cost than the sticks and thus stay longer in the household. Because the user is more likely to replace an electronic accessory for $ 30 from a brand new Smart TV.

Roku can hold 70% more market share by the end of the year than its closest competitor if it continues to dominate the market for smart TVs. And this proportion will continue to grow as Roku TV users stay on the ball and Roku wins more new users.

More engaged users

Users of Roku TV are not only more likely to stay with the brand, but also remain more loyal to the operating system. Roku's initial screen is the first thing Roku TV users see when they turn on the TV, and Roku can add more features to protect users.

The potential for increased exposure to Roku TV versus other Roku devices is reflected in the acceleration of the production hours in each of the last five quarters. Roku has a significant advantage over other streaming platforms for each user.

Although Amazon can treat its 34 million global firewall users, it does not reveal consumer engagement. Roku's average consumer spent about 3.5 hours a day on television in the first quarter.

There is still a significant difference between Roku's commitment and its monetization. One of the key factors for this is to turn more advertisers into streaming video operators. Roku TV users can help Roku bring more TV advertisers to the platform. The platform offers completely different and more accurate metering options than pure TVs.

Keep pace

In recent years Roku has continuously acquired market share in the Smart TV industry in the US. Competition has also improved, especially through Amazon, so Roku must continue to develop partnerships and capabilities to maintain its operating system.

Even internationally, where the company is not so well known, there is a great opportunity. In its letter to the fourth quarter of shareholders, management said it would increase investment in international markets, but expects returns from these investments in 2020. First, you have to overcome the mass awareness of the brand Amazon and others have already built on these markets. However, with enough partnerships and marketing, Roku must be able to reproduce the success already achieved in the US elsewhere.

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A little-known company redefines the subject of payment processing. Consequence: + 49% revenue growth (2018) and 52% margin before tax and depreciation. The fully integrated platform for e-commerce, mobile commerce and wholesale of bricks and mortars reaches over 3 billion people, makes payments more fraud-resistant than ever and shows the best performance in the competition. New technology giant of tomorrow?

Motley Fool has already collected a free special report that provides the most important information about this company. Click here to download this report for free.

Motley Fool owns and recommends shares of the alphabet, Amazon, Microsoft and Roku. Adam Levy owns shares of Alphabet, Amazon, and Microsoft.

This article was released on Fool.com on 1.7.2019 and has been translated for our German readers.

Motley Fool Germany 2019


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