Netflix's Potential Move into Channel Store and Bundling Partnerships
Netflix may explore opening its own channel store, following the lead of Amazon and Roku, and is also considering a bundling partnership with Fox One, according to a recent analysis by Morgan Stanley.
The report suggests that Netflix could partner with third-party services like Fox One to stream NFC Sunday afternoon NFL games, reaching approximately 90 million Netflix subscribers in the U.S. without direct negotiations with the league.
While both companies have expressed openness to partnerships, no specific deals have been commented on. High-profile co-branded streaming bundles, such as Disney+, Hulu, and HBO Max, have demonstrated improved subscriber retention and lower churn rates.
Other notable premium bundling deals include Peacock from NBCU and Apple TV. Morgan Stanley predicts that Fox One will be bundled across various distributors and platforms in the future, building on its existing deal with ESPN.
These bundles offer cost savings for subscribers by combining services into a single package. Morgan Stanley, having resumed coverage of Fox Corp., highlights the significant phase in streaming for major legacy media companies, particularly with the $22 billion Fox Corp.-Roku deal.
The report describes the deal as a "bold play on the future of streaming distribution" and notes that Roku's improved targeting capabilities, combined with Fox's sports content, scale, and sales expertise, will enhance ad fill rates and optimize cost per thousand viewers (CPMs).
With Roku as a major streaming distributor, Morgan Stanley predicts that Fox One could rapidly scale to over five million subscribers by 2030.