The Federal Government Might Not Let Netflix Get Away With This

[View in browser]( Proprietary Data Insights Top Entertainment Stock Searches This Month Rank Name Searches #1 AMC Entertainment 1,300,396 #2 Netflix 153,000 #3 Walt Disney Company 133,279 #4 Roku 55,933 #5 Comcast Corp 9,081 #ad [Invest In the AI Upgrading the Fast-Food Industry]( Netflix Inflation Source: [The Verge]( Streaming Inflation It’s not only Netflix that’s making us feel like streaming isn’t the bargain it was just a few years ago when we started cutting the cord from traditional cable TV. If you want a cable-like package from a streamer these days, it’ll cost you. In some cases, just as much as a package from an old school name such as Comcast. Here’s a representative example: - YouTube TV costs $65 a month for 85 channels. That’s up from $35 just four years ago. - Add Showtime and you’ll pay $11 more a month. Starz, $9. - Sports and other premium packages can cost even more. By comparison, Comcast’s most expensive package runs $85 a month for 12 months with more than 260 channels. Americans love to hate cable companies. So, given fresh options, we abandoned them in droves. While we don’t quite hate the streaming platforms yet, the writing might be on the wall. [Brought to you by Miso]( [Invest In the AI Upgrading the Fast-Food Industry by June 23]( Remember this name: Miso Not “miso” as in the soup you order with your sushi, but Miso: the cutting-edge AI and robotics developer saving quick service restaurants from $70.3 billion in labor spend. Most restaurants suffer from razor-thin margins of around 3-5%, but the biggest brands in the game may have found a way to bump those numbers up. Meet Flippy 2 and Sippy, a pair of autonomous kitchen assistants from Miso Robotics. These kitchen-bots are headed to Jack in the Box for a standalone pilot, which could open the door to thousands of other opportunities. They’re also joining the staff at 100 more White Castle restaurants. Those are just a handful of Miso’s many industry partners today, and they’re just getting started. Grab shares of Miso Robotics before they’re packing your bento box. Campaign closes 6/23. [Invest in Miso]( Investing The Federal Government Might Not Let Netflix Get Away With This Key Takeaways: - The media continues to list all the (obvious) reasons why Roku should buy Netflix. - There’s no doubt the deal makes theoretical sense, especially for Netflix. - However, The Juice wonders if the Government might have a problem. Every analysis The Juice has seen of the rumor that Netflix (NFLX) will buy Roku (ROKU) says the same thing. There’s incredible synergy and tons of benefits (especially for Netflix) in this deal. In fact, Motley Fool called it a match made in heaven that, apparently, Roku employees hope happens. They’ll make out financially. And Netflix will, for starters, solve one of its biggest problems - getting an advertising strategy off the ground as quickly as possible. Sounds Great, But Here’s The Problem A few years ago net neutrality was all the rage. The idea that internet service providers - companies such as Comcast - should treat all content and content providers equally. They shouldn’t favor bigger players or slow down streaming speeds for, say, Netflix or Apple TV, while favoring their own service. For a long time, Netflix CEO Reed Hastings was a huge supporter of net neutrality. That was until Netflix became so big it didn’t have to worry about an ISP bullying it. While a Netflix/Roku deal doesn’t speak directly to net neutrality, a similar principle applies. Netflix Would Have Too Much Control Over Streaming Source: [eMarketer]( Roku dominates among streaming operating systems. - As of late last year, Roku owned more U.S. connected TV market share (51.7%) than Amazon’s Fire TV (45.0%) and Apple TV (13.1%). - In Q1/2022, Roku added 1.1 million accounts to hit 61.3 million. - In terms of hours streamed, Roku’s Roku Channel, which features a mix of live and on-demand content, was among the top 5 apps on the platform. Simply put, if Netflix buys Roku it will control a ton of content (its own and Roku’s growing stable) as well as the biggest delivery system of streaming content in the U.S. It would gain a level of control over its competitors - at least in the Roku ecosystem - the Department of Justice might not be comfortable with. Look At Your Remote Control Roku doesn’t just throw names in a hat to decide which platforms get those special featured buttons on your remote control. It costs money. Streaming services reportedly pay $1 a customer to get that placement. Taking over the Roku homepage can cost millions. You see where we’re going. Netflix could very easily turn the screws on its competitors, giving itself the upper hand and prime placement across Roku. The Bottom Line: The Juice has yet to hear anybody bring up the government amid these Netflix/Roku rumors. So we wanted to throw this out there before people get too excited about a potential deal. At the same time, Netflix might not have the financial firepower to pull off the transaction. It would likely have to pay something in the neighborhood of $15 billion for Roku, representing a 30% premium. That’s a lot, particularly when you consider Netflix sits on just $6 billion in cash and $14.5 billion in long-term debt. Buying Roku could be a bad deal for Netflix shareholders, adding to [the list of things]( that make the stock increasingly unattractive at the moment. 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