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Here's Why Roku (ROKU) Stock Soared on Wednesday
Shares of streaming device maker Roku (ROKU - Free Report) closed up over 18% in Wednesday’s trading session, steadily gaining all day after the company announced a new multiyear agreement with Alphabet’s (GOOGL - Free Report) Google to keep YouTube and YouTube TV on its platform.
Google had threatened to pull both apps off of Roku tomorrow, December 9 in a battle that pitted a Big Tech giant and a small tech firm against each other. The negotiations grew especially combative over both Roku’s and Google’s need for advertising revenue since they compete in the digital ad space.
Roku and Google’s fight even ended up catching the attention of some Congress members attempting to push Big Tech antitrust legislation
However, this new agreement avoids a YouTube blackout, and allows Roku’s 56.4 million active accounts to access YouTube on the platform without disruption. If a deal had not been reached, Roku could have faced a wave of cancellations in favor of Apple TV and Amazon Fire TV, as they both carry YouTube on their streaming platforms.