Market Watch

Roku Launches Set-Top Box Through Retail Outlets

October 25, 2010

Need more Information?

Display Driver IC Forecast

Roku ventured beyond its online-only strategy October 14th, by launching its connected set-top box (STB) devices via third party retail outlets, in partnership with computer networking equipment company Netgear. Netgear's large distribution network will make a Netgear-branded Roku XD Player, dubbed the NTV-250, available at retail outlets for the first time, including Amazon, Radio Shack, Best Buy and Walmart. Until now, Roku STBs have only been available for purchase directly via the manufacturer's website.

Coinciding with the launch of a Netgear-branded Roku Player NTV250, is Roku's latest generation of set-top boxes, which consists of three new models. While Netgear is selling branded versions of Roku's XD model, it is not however, selling Roku's standard HD model, nor the company's top-of-line XDS model.

  • Roku HD - The new $59.99 Roku HD only does 720p, but it has also been redesigned and is smaller than ever.
  • Roku XD - The XD is the new mid-range model at $79.99, and gets updated Wireless-N functionality and 1080p playback.
  • Roku XDS - The XDS, the new $99.99 top-of-the-line model, offers 1080p support, a USB port for local media, optical and component outputs and dual-band wireless technology.

The NTV-250 will retail at approximately $10 more than the Roku XD Player. All the STBs come with access to Roku's Channel Store, allowing access to not only Netflix Watch Instantly and Amazon Video On Demand, but also a broad range of over-the-top (OTT) content, including Pandora, Major League Baseball's and, starting in November, Hulu Plus.
Roku, the Saratoga-based company which launched its first Roku Netflix Player in 2008, is seeking to expand its retail footprint beyond direct sales through its Netgear partnership. This is the first box Roku has marketed via retail channels and a third-party tech brand. The involvement of a third-party hasn't altered software or most other features.

Screen Digest expects that Roku will have over 1m devices installed in US households by end 2010, and are doubling in sales every year. This added visibility to a big-box shoppers at a slightly lower price will be needed to hold off its biggest hardware competitor, Apple TV, which despite its delay has sold 250,000 units in 18 days, and Google TV, which has taken a software and services approach to the over-the-top platform business by launching in partnership with major electronics manufacturers such as Sony.

To date, Roku has been the most aggressive start-up in the over-the-top STB market, while major contenders such as Apple still struggle to strike the right tone in their living room video strategy. Though Apple has the major advantages of combining the iTunes Store and media library with its living room hardware, and has the deep pockets and distribution base to still seal this market, it has yet to meaningfully unlock the channel store concept Roku has managed to develop, nor build a convincing services platform that can persuade pay-TV customers to cut their cord in favor of receiving all their TV entertainment via an internet-connected device.

The current capabilities and streaming offering position the new Roku boxes above the capabilities of recently announced Apple TV, especially 1080p streaming capabilities. And, in the future, Roku also promised to add DLNA support which will put them also in direct competition with other media streamer boxes as Western Digital WD TV Live Plus HD and Viewsonic VMP75. What is most significant however is Roku's move in deploying an on-demand over-the-top multichannel platform, releasing its own SDK, a software development kit, that allows anyone to write a channel and have it carried in the channel store and on Roku hardware.  The company just partnered with Ooyala on enabling channel creation. It currently has 80 public channels carried in their channel store. It also currently has more than 100 private channels, which need a private code from service provider to enable.

Netgear meanwhile, along with rival networking equipment manufacturers D-Link and Cisco's Linksys, is currently figuring out its living room TV strategy - its 'NeoTV' media players, priced at $219, failing to excite consumers. This new partnership with Roku keeps Netgear in the picture in the short term, especially in light of rival D-Link's alliance with Boxee, and computer peripheral manufacturer Logitech's partnership with Google on Google TV.

Find Out More > iSuppli | Screen Digest Broadband Media Intelligence Service

Research by Market
Media & Advertising
Share facebook Twitter Google Plus Linked In Add This Contact Us