What if ‘winning’ the streaming game doesn’t lie in creating the largest channel, but in dominating how people consume streaming services? This is a question we could see Roku answer in the coming years. Entertainment lawyer Brandon Blake examines their stranglehold on the smart TV market.
A Risky Gamble
Roku entered the wider streaming market seven years ago, when digital distribution of entertainment content was still in its relative infancy. Instead of gambling only on their own channel, they instead provided an operating system that sought to tie together people’s existing hardware with the shift to digital through their set top boxes. Today, most people buy their products fully integrated on smart TVs, although they still have set top boxes on offer.
Last year, they sold more smart TVs to U.S families than any competitor. As of the end of 2021, they have a 38% share domestically, and 31% share in Canada. They claim 51.2M active accounts, 14M of which came online in the last year. Roughly 58.7B hours of entertainment was watched through Roku devices in 2020.
Not bad for a brand that was unknown at launch.
Monopolizing the TV Space
Most of this was created through offering affordable smart TV sets, backward-compatible tech, and an easy-to-use UI instead of the latest, greatest features. This at a time when the American public were still only dabbling in the intimidating new streaming spaces and reluctant to spend much. It is still primarily their smart TV UI that drives the company bottom line, with other tech reaching only middling sales stats.
It’s certainly given them power in the streaming landscape despite owning no studio or content creation point of their own. Of course, they haven’t been bulletproof, as we saw in their messy negotiations with AT&T over HBO Max last year. However, they have an undeniable traction in the market, even getting away with some ad-sharing and revenue demands no other third-party host has managed to date. They have also been fairly successful in demanding that parts of their partners’ catalogs go to their (free) Roku Channel.
It’s an interesting side development in the streaming space, and one they continue to dominate. Could winning the streaming wars lie in not fighting them at all, but simply leveraging others? Blake & Wang P.A will certainly be interested to see how Roku develops over the next few years, as streaming becomes the dominant film and TV market player.
Film and Television 