Roku Launches Branded Soundbar, Subwoofer

Roku Sept. 4 announced it is expanding its portfolio of premium audio products to include a sound bar and wireless subwoofer.

The Roku Smart Soundbar is an easy way to add premium sound movie, TV and music streaming to any TV with an HDMI input. The optional Roku Wireless Subwoofer expands the Roku Smart Soundbar with deeper, richer bass.

Both products can be pre-ordered from Roku.com for $179.99 each. General availability at Best Buy and Roku.com is also expected in October.

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“The Roku Smart Soundbar is a great value and makes it easier than ever to add incredible sound and powerful streaming to any TV. In addition, if you want heart-pounding bass you can easily add that too,” Mark Ely, VP, players and whole home product management at Roku, said in a statement.

The Roku Smart Soundbar is powered by the Roku OS. Four premium drivers offer distinctive clarity, immersive depth and dynamic bass response.

Advanced volume modes enable consumers to reach for the remote less often. Automatic Volume Leveling offers uniform audio level across various types of content, including quieting loud commercials. Night mode lowers the volume for louder scenes and boosts it for quieter ones. Speech Clarity boosts voice frequencies to address intelligibility for crisp, clear dialogue. Automatic software updates will deliver new capabilities over time.

Additional features include: Roku Connect: A wireless protocol that seamlessly connects the Roku ecosystem, Dolby Audio, Bluetooth connectivity, HDMI/Optical Support inputs; Roku Search: cross-channel search offers results ranked by price; Roku Voice search for entertainment, replay, turn closed captions on and off and more through the Roku Voice Remote.

Voice Assistant Compatibility: The Roku Smart Soundbar works with Google Assistant and is compatible with Amazon Alexa-enabled devices
Roku Voice remote: The point-anywhere remote features channel shortcut buttons and TV on/off buttons.

 

‘Kids & Family’ Service Added to the Roku Channel

Roku has announced the addition of the “Kids & Family” service on the Roku Channel, making it easy for children and parents to find a selection of tailored content available for free and through premium subscriptions, according to the company.

In addition, Roku is rolling out parental control features for the Roku Channel.

“We recognize that it can be a challenge to find quality kids and family entertainment across multiple streaming channels, particularly free, ad-supported options,” said Rob Holmes, VP of programming and engagement, Roku, in a statement. “’Kids & Family’ not only provides a selection of great free, ad-supported content from partners like pocket.watch with ‘Ryan’s World’ and Lionsgate’s ‘Leapfrog,’ but also highlights kids’ entertainment from existing premium subscriptions partners. Parents looking to find great programming for their children will enjoy the ease of going to the Roku Channel as their one place for kids and family entertainment.”

“Kids & Family” delivers a blend of shows, movies, and live linear and short-form video typically found across multiple free and paid kids’ channels and brings them together to watch in a single place, according to a Roku release. In addition to free, ad-supported options, users who have already subscribed to premium subscriptions through the Roku Channel will be able to view subscription-based kids and family content from partners such as Hopster, Noggin and Zoomoo, as well as children’s entertainment from services such as HBO and Starz, directly within “Kids & Family.”

Roku’s in-house editorial team created the “Kids & Family” experience to feature series, movies and entertainment for kids, according to the release. It offers 7,000 free, ad-supported movies and TV episodes from more than 20 partners such as All Spark, A Hasbro Company, DHX Media, Happy Kids TV, Lionsgate, Mattel, Moonbug, and pocket.watch, among others. Programming includes  shows such as “Care Bears,” “The Cat in the Hat,” “Leapfrog,” “Little Baby Bum,” “My Little Pony,” “Rev & Roll,” “Super Mario Brothers” and “Thomas & Friends”; live/linear streams featuring 24/7 kids programming available from Moonbug, pocket.watch and partners powered by Xumo, including Ameba, BatteryPop and KidGenius; five exclusive episodes of 22-minute series “Ryan’s World” by pocket.watch available directly on the Roku Channel for the first time; and premium subscriptions from Blue Ant Media’s ZooMoo, CONtv, Dove Channel, HBO, Hopster, Noggin, Starz or Up Faith and Family through the Roku Channel, featuring such series as “Bubble Guppies,” “Dora the Explorer,” “PAW Patrol,” “Peppa Pig” and movies including Adventures of Elmo in Groucholand and Muppets Take Manhattan.

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“There is a tremendous opportunity to expand our reach with the quickly growing audience on the Roku Channel,” said Chris M. Williams, founder and CEO, pocket.watch, in a statement. “Family time is often enjoyed in the living room where Roku is so successful and we’re thrilled to bring our biggest creator partners, like Ryan from ‘Ryan’s World,’ into the heart of the home through the new pocket.watch channel.”

Kids & Family” will have approximately 40% of the advertising time of traditional linear television, according to Roku. Lego Systems has signed on as the first advertising sponsor of the service.

“Roku offers a custom experience that will help us connect with our kid and family audiences, who are consuming content on an evolving array of platforms,” said Michael McNally, senior director at the Lego Group, in a statement. “We’re thrilled to be the exclusive sponsorship partner in ‘Kids & Family’ on The Roku Channel.”

PIN-based playback controls to the Roku Channel help parents set access limits to content based on ratings within the Roku Channel. If the setting is enabled, a PIN will be required in order to view videos on the Roku Channel based on the content rating.

“Kids & Family” is now available to users of the Roku Channel in the United States and will be available on Roku devices, via the Web and on select Samsung smart TVs that access the Roku Channel.

Best Buy, Roku, Apple Shares Rebound Following Tariff Delay

Shares of Best Buy, Roku, Apple and other consumer electronics retailers/manufactures rebounded after President Trump delayed until Dec. 15 a proposed new 10% tariff on cellphones, laptop computers, video game consoles and other goods manufactured in China.

The tariff on $300 billion worth of products, which Trump announced Aug. 1 as part of ongoing trade tensions with the world’s No. 2 economic power, would have been on top of an existing 25% tariff Trump previously imposed on $250 billion worth of other Chinese goods.

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The delay came after intense lobbying efforts in the nation’s capital convinced administration officials the new tariff could have serious implications to the U.S. economy entering the fourth quarter.

“Just in case they might have an impact on people … what we’ve done is we’ve delayed it so they won’t be relevant for the Christmas shopping season,” Trump told reporters on Aug. 13.

The news was welcomed by Wall Street, which saw shares of Best Buy, Apple and Roku rise 6.5%, 4% and 1%, respectively.

Roku is one of the largest manufacturer of Internet-connected televisions, with many originating from China.

But to the Consumer Technology Association trade group, delaying proposed tariffs only prolongs market uncertainty and impacts consumers 401(K) pension or retirement accounts, among other issues.

“Retaliatory tariffs are bad economic policy in the short and long term,” Gary Shapiro, CEO of the CTA, said in a statement. “The administration’s legally dubious trade war is compromising America’s global leadership.”

Previously-announced tariffs starting Sep. 1 will affect $52 billion in consumer technology products, and the tariffs starting Dec. 15 will affect $115 billion in products. Since July 2018, Section 301 tariffs on China have cost the consumer tech industry over $10 billion, including $1 billion on 5G-related products, according to the CTA.

“Tariffs are taxes,” Shapiro said. “The Chinese government doesn’t pay for them – Americans bear the burden. And next month, we’ll begin to pay more for some of our favorite tech devices – including TVs, smart speakers and desktop computers. The administration should permanently remove these harmful tariffs and find another way to hold China accountable for its unfair trading practices.”

Roku Manufacturing Walmart-Branded Streaming Video Devices

Lost in Roku’s recent impressive financial results was disclosure that the streaming media device manufacturer and operating software platform is working with Walmart to roll out branded hardware.

“We recently agreed with Walmart to offer several new Roku devices, including audio [speaker] products to their customers under their Onn brand,” CEO Andy Wood and CFO Steve Louden wrote in the shareholder letter. “This is in addition to Roku TVs and Roku players already sold through Walmart.”

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Roku manufactures OEM streaming hardware and sticks for Comcast/Sky-owned Now TV, among other European customers. The OS platform will be at the heart of NBC Universal’s pending streaming service.

Roku also remains one of the largest smart TV  brands due to its embedded OS platform in myriad third-party TVs, including Philips, RCA, JVC, Hitachi, Sharp, TCL and other Chinese-made units — many sold in Walmart.

The Roku platform revenue continues to drive the company’s growth at the expense of loss-leading hardware sales.

Platform (ad-supported) revenue in the second quarter (ended June 30) skyrocketed 89% to $167.7 million, while streaming device (hardware) revenue increased 24% to $82.4 million from $66.5 million last year.

Indeed, The Roku Channel has become one of the largest AVOD platforms delivering free, largely third-party catalog content.

With Walmart reportedly killing efforts to produce original content and a branded streaming video service around Vudu, partnering with Roku could help the world’s largest brick-and-mortar retailer remain relevant in the digital age.

It could also help Roku grow its 30 million active monthly accounts.

 

Roku Tops 30 Million Subs, Stock Up Nearly 9%

Roku hit a fiscal home run Aug. 7, beating its estimates for second-quarter (ended June 30) revenue, gross profit and pre-tax earnings.

The streaming media device manufacturer and over-the-top operating system, said it ended the quarter with more than 30 million active user accounts — up 39% from 22 million accounts in the previous-year period.

Total revenue increased 59% to $250.1 million, while platform (ad-supported) revenue skyrocketed 89% to $167.7 million.

Streaming device revenue increased 24% to %82.4 million from $66.5 million last year.

“The industry-wide shift to streaming is accelerating,” founder/CEO Anthony Wood and CFO Steve Louden wrote in the shareholder letter.

At the same time, Roku is attempting migrate revenue away from hardware to advertising and evergreen software sales. As a result, hardware operating income dropped 69% to $4.5 million from $14.7 million, due in part to lower pricing for Roku players and streaming sticks.

“As anticipated, gross margin declined sequentially due to continued mix shift to video advertising, the introduction of premium subscriptions and our strategy of driving down player [average sales pricing] … grows our active accounts faster,” Wood and Louden wrote.

The net effect resulted in loss from operations increasing to $10.4 million from $100,000 last year.

Regardless, Roku’s status among TV manufacturers seeking connectivity with the Internet remains strong.

According to Kantar Milward Brown, Roku is the No. 1 TV streaming platform in the U.S. by hours streamed. Last month, Strategy Analytics reported that the Roku operating system powers about 41 million OTT devices and smart TVs in the U.S. This is 36% greater than the next closest competitor and expected to grow.

Separately, Parks Associates consumer survey data revealed Roku had 39% of the U.S. streaming media player installed base as of Q1 2019.

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Roku disclosed it has partnered with Walmart to roll out a series of OEM branded streaming devices under the retailer’s name.

“This is in addition to Roku TVs and Roku players already sold through Walmart,” they wrote. “Our purpose-built OS allows us to offer superior streaming experiences to consumers at attractive price points.”

Wood and Louden contend 3.5 million U.S. TV households cut the cord from March 2018 through February of 2019, moving from traditional pay-TV to streaming.

“‘Cord-cutters’ and ‘cord-nevers’ access video on their TV exclusively through streaming and Roku has the largest share in the U.S.,” read the letter. “This is a valuable strategic position for our advertising business as brands cannot reach these consumers via traditional linear TV.”

 

OTT Video Consumption Skyrockets

Consumers in the United States continue to migrate toward over-the-top video distribution with streaming viewing hours in the second quarter (ended June 30) more than double (130%) from a year ago, according to new data from Conviva.

While major markets dominate overall domestic streaming consumption, Dallas, Atlanta, and Phoenix are the top 3 cities when streaming video consumption is normalized by population — ahead of tech hubs Boston, New York, and San Francisco.

The percentage of televisions connected to the Internet increased 143%, largely driven by Roku with 173% growth and 43% market share of connected TV viewing. Amazon Fire TV was up 145% in viewing with an 18% share. Apple TV was up 129% to account for 10% share.

“In 2019, streaming is coming into its own,” read the report.

Video-on-demand now accounts for 66% of all viewing hours, up from 59% last year. While mobile devices command near equal share of live versus on-demand viewing at 22.8% and 23.7%, respectively, PCs garner more share of on-demand viewing at 16.5% versus 12.6%, while connected TVs command more share of live at 56.5% versus 53.1%.

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Notably, Roku accounted for the majority of all live viewing via connected TV with 53.8%.

The report found that online TV services such as DirecTV Now, Hulu with Live TV, PlayStation Vue and Sling TV saw triple-digit growth in viewing year over year.

Market dynamics, including consolidation and the increase of hybrid business models from media companies such as NBC Universal, Apple, Disney and WarnerMedia, suggest there is even more room for growth and innovation as the lines between business models blur.

Conviva said the growth gap between studios content creators and online distributors closed even more in Q2 than previous quarters, but content aggregators continue to best other services in terms of consumption as well as quality, with viewing hours up 168% year over year.

Not to be outdone, publishers in the United States also recorded impressive growth of 137% in viewing hours year over year. The overall growth in consumption is indicative of headroom for existing streaming services alongside future entrants.

“Increased competition will also spur innovation and, as the industry saw with hybrid models with subscription and ads, more convergence in business models,” read the report.

Facebook and YouTube saw 15% more videos posted as news media led social media with the largest growth in average total video views, up 197% year-over-year. Entertainment led in growth of views per video, up 99%.
While ad-supported VOD and online TV continue to gain traction among consumers, Conviva found that ad buffering remains a “silent engagement killer” among users.

The difference between a viewer making it past the 5% mark in the video stream depends greatly on whether or not the ad flows correctly. In addition, the average streaming ad length reached 24.87 seconds despite the fact viewership drops significantly with 20+ second ads.

“The TV industry of yesterday was built on inflexible standards, antiquated measurement, and limited data. Streaming offers the vast potential of a rapidly maturing market, flexibility, targeting, and data to understand the audience like never before.”

Parks: Streaming Media Player Ownership Flattening With Roku and Amazon Leading Space

More than a third (39%) of U.S. broadband households own a streaming media player, but that’s a mere 1% increase from 2018, according to new research from Parks Associates.

Ownership has flattened, the firm noted, although purchase intentions are higher for 2019 compared to previous years.

The report, 360 Deep Dive: Adoption and Use of Connected Video Devices, found connected video device manufacturers may need to shift focus from hardware sales to service and advertising revenue, as ownership reaches saturation, according to Parks.

“Streaming media has reshaped how U.S. consumers interact with entertainment content and services, so as the market matures, sales increasingly come at another vendor’s expense,” said Parks senior analyst Kristen Hanich in a statement. “Video-quality features are the most important factors when consumers buy a connected video device, although Roku and Amazon have certainly benefited among streaming media players by having broad product portfolios that include lower price points.”

Among streaming media players, Roku and Amazon’s Fire TV are the clear market leaders with almost 70% of the installed base of streaming media players in the United States, according to the firm. Consumer-reported data reveals that between Q1 2017 and Q1 2019, Roku’s share of the U.S. streaming media player installed base grew from 37% to 39%, while Amazon’s share of the installed base increased from 24% to 30%.

The report looks at the state of the connected video device space, including smart TV platforms, streaming media devices, smart set-top boxes and gaming consoles, examining the changing roles of these devices and how consumers are engaging with new functionality, such as voice control and live TV integration.

“As the addressable market shrinks, rivalry increases,” said Parks senior analyst Craig Leslie in a statement. “The combined installed base for Roku and Amazon is three times larger than the nearest competitor. The adoption of Roku and Fire TV streaming media players continues to grow at the expense of Chromecast and Apple TV.”

Dish Bows 4K HDR-Compatible Streaming Stick

Dish Network’s AirTV subsidiary July 15 announced the launch of a 4K HDR compatible streaming stick, powered by Google’s Android TV operating system.

The palm-sized $79.99 AirTV Mini device integrates Sling TV, Netflix and other over-the-top apps, in addition to OTA digital channels when paired with a compatible antenna and a Wi-Fi-enabled network tuner.

“The AirTV brand is committed to making local TV relevant and easily accessible to streamers,” Mitch Weinraub, director of product development for AirTV, said in a statement.

Users simply plug the AirTV Mini into their television’s HDMI port to access the user experience. Once connected, the device will launch directly into the Sling TV app and users will see Netflix integrated into the Sling TV user interface.

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AirTV Mini users also have access to third-party apps available from Google Play. Local channel availability depends on geographic location and antenna quality and placement.

The streaming stick supports Google Assistant via a dedicated button on the remote to get answers about the weather forecast, game scores or traffic and control smart home devices like lighting and thermostats. Users can also press a Netflix button on the remote to launch the Netflix app for an easy and seamless streaming experience.

The remote also has the ability to control televisions and sound bars, and features a prominent Sling TV shortcut button and a voice search button to find favorite shows and movies.

Voice controls are app-sensitive and allow users to find a specific show or movie within the app they are using, or make commands such as “go to guide,” “show me my DVR” or “rewind 10 seconds.”

AirTV Mini is equipped with a remote finder button, allowing users to locate a misplaced remote with the touch of a button.

For a limited time, new and eligible existing Sling TV customers can receive the AirTV Wi-Fi-enabled network tuner with an indoor antenna free when they prepay for three months of Sling TV (subscription must be $25/month or greater).

Roku Remains Top Streaming Media Device in U.S.

Roku’s streaming TV platform accounted for more than 30% of U.S. sales of connected TV devices in Q1 2019, further increasing its lead in streaming TV platforms, according to the latest data from Strategy Analytics.

The British research firm finds that there are more than 41 million Roku-based devices in use, including branded set-top devices, HDMI sticks and smart TVs, accounting for 15.2% of all media streaming devices.

Roku now has a 36% lead over the next major platform, Sony PlayStation, in terms of devices in use. The report predicts that this lead will stretch to 70% by the end of the year, largely as a result of the success of Roku’s smart TV partner strategy.

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Other key findings from the report include:

Amazon’s Fire TV OS was the second-most-sold streaming TV platform in Q1 2019, with 12% of sales, followed by Samsung’s Tizen at 11% and Google (Android TV and Chromecast) at 9%

By the end of 2019 more than 52 million Roku-powered devices will be in use, accounting for 18% of all connected media devices

“Roku had another strong quarter in Q1 and continues to hold a commanding lead in streaming media platforms in spite of Amazon’s growing influence in the living room,” David Watkins, director at Strategy Analytics and the report’s author, said in a statement.

Watkins said Roku’s firs-mover status (it co-pioneered subscription VOD with Netflix), content offering of third-party streaming services, comprehensive search function and simple and intuitive user interface have contributed in its success.

The analyst cautioned Roku is less well-known outside of the U.S. and to succeed on the international stage would need to “face down” the challenges of building brand awareness and drawing users away from well-established players such as Amazon, Apple and Google.

“There was record growth in the smart TV market in the first quarter of 2019 and Roku and TCL have proved to be a great partnership in this rapidly growing segment,” added David Mercer, principal analyst at Strategy Analytics. “Roku is set to become the U.S.’s top smart TV platform this year in terms of sales share, and Google and Amazon clearly have their work cut out to stay in touch with the market leader.”

IHS: China’s TCL Brand Tops North American TV Market

With just about everything made in China, it’s little surprise a Chinese television manufacturer has unseated South Korea’s Samsung for top unit sales in North America.

With China and the United States embroiled in a trade dispute, the rush to import Chinese TVs ahead of proposed tariffs is at a fevered pitch.

China’s TCL unit shipments climbed to 26.2% in the first quarter (ended March 31), up from 16% during the previous-year period, according to new data from IHS Markit.

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Perennial market leader Samsung saw shipments drop to 21.8% from 28%. No. 3 Vizio shipments nearly reached 14%, according to the data first reported by Advanced-Television.

TCL, which markets TVs featuring the Roku operating system, helped drive North American unit shipments up 30% to a record 9.3 million units.

Samsung still dominates the market in revenue (36.9%) due to its larger screens across its product line and higher price points.

“As uncertainty mounts around a possible tariff-driven rise in costs, these brands have been bolstering shipments to protect against any potential disruption,” Paul Gagnon, research executive director at IHS Markit, said in a statement. “Given that margins for TVs are relatively low compared to other consumer-electronics categories, any tariff increase would have a major impact on sales.”