Why Roku Wants Quibi's Content Catalog

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Last year qube became infamous as a well funded but short lived streaming service. It raised one point. Seven five billion dollars from high profile backers ben shutdown just six months after it launched now people familiar with the matter say the company is in advanced talks to sell its content catalog to roku the leading distributor of streaming services. Here to explain what's going on and how this news fits into a broader story about the streaming industry is our media reporter benjamin mullen. Hey ben thanks for joining me. Hey thanks for having me okay. So we should note that these talks are still going on and they could still fall apart. But i want to start by just understanding why a partnership could be strategic for both sides here. So let's start quickly. It's obviously now so what's in this. It makes sense for you to do this. Because the licenses to the content that was on their service is one of the most valuable things they still have. They have cash on hand that they're planning to pay back to their investors. And i guess the reason why they're doing this is because it's what they still have so it's one of the most valuable remaining assets and how is going to be handling. Its content more broadly. Now that it's shuttered. The company really put a lot of resources into its content big names. They recruited a lot of talent and the trip. Some really out of the box content ideas i imagine. They don't want all that to go to waste. So does that factor into these talks. Yeah they're still trying to figure it out. That's what these talks are about is all the producers who developed programming for qube they want their shows to be viewed by people because they put all this effort into him and qube wants to make money as much as they can from the library that they have and so buyers potentially want to exhibit these shows sell advertising sell subscriptions around them. So you can. You can see why it would make sense for all parties to get. Get to a deal here. Yeah and let's talk more about roku point of view. Why would this be strategic for them. Specifically roku has its own channel called appropriately the roku channel and they sell advertising on this channel and the advertising that they sell on the roku channel. The terms for the advertising deals are really really favorable to them so if they have more original content that they can put in the roku channel. They have a better case to make to advertisers and potentially more advertising revenue and of course their main role right now is as a distributor. That's the position they've been leveraging as they make deals with content producers as we've talked about on the show recently could up partnership with qube help roku convinced more streaming companies to make content available with roku. Well you could envision a situation where they tell. at which owns hbo. You should put your content on the roku channel because look at all this content. we have on their. We have exclusive content so this channels are really valuable. Place for you to be and you'll be alongside some other really good shows and one thing i have questions about. Quip was made specifically for mobile and it really prided itself on its so-called turnstile technology that changes the formatting of the shows depending on which way you're holding your phone but roku is primarily used on actual. So how would that partnership even work. That's a good question. I imagined that a lot of the content that'll be showed on the roku channel or roku if this deal would go through would be in the horizontal aspect ratio. Because most people's tv's are obviously oriented horizontally the vertical component of the shows. I'm not sure how that fits into a traditional roku. Apper your roku viewing device. Got it so questions yet to be answered here and just zooming out. What are these deal. Talks tell us about entertainment. And the strategy behind how content producers and content distributors are trying to navigate the fast changing world. I think what qualities demise showed. Everyone is that it's really a competitive place. There's a lot of streaming services that have launched even the last half year so and qube was obviously unsuccessful in navigating the competition so and roku has built success largely on the back of the growth of streaming because there are huge distributor so roku was accompanying that manage to really seize on the success of streaming and is captured an ever-growing part of that pie and qube. I think you can safely categorize them as a half of the streaming wars. You know they haven't been able to capitalize in the same way that roku has and in this case roku so it like the winners of the streaming moore's may end up absorbing the losers. Yeah yeah in this case. That definitely seems to be what happened all right. That's a reporter. Benjamin mullen ben. Thanks so much for joining me thanks. Amanda

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