Roku's Big Investment Means More TV on Its Box
Streaming TV box maker Roku just got $45 million and a "strategic relationship" from big media players News Corp. and British Sky Broadcasting, a sum and connections it can use to give us more streaming options (mostly) without cable. In the company press release, via AllThingsD's Kara Swisher, the company says it will use the money for various aspects of its business, such as "brand awareness and "develop new international markets," but it also mentions one key venture that matters to we the viewers: "content packages." Meaning: Roku will take some of that money and those connections to secure rights to more shows on the $50 streamer. Roku already has a hefty arsenal of offerings, many of which come for free, others users only get access with subscriptions. But this investment will provide capital for more partnerships, which will make Roku more like the cord-cutting solution we want but still not our dream come true.
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Roku has already benefited from its closeness with both News Corp. and BSkyB. News Corp. has various Channel apps on the box, including the free apps Fox News, WSJ Live, and X Factor. BskyB announced a Now TV deal earlier this year. We imagine the investment will strengthen that bond. And, as for the money, it could use that to strike up partnerships like the one it just made with Dish Network, which provides International channels for a $20 per month subscription. That kind of thing is exactly what we want: Debundling.
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But, Roku could run into some trouble as it expands. First, as it strikes up partnerships with more desirable providers, it doesn't always get the deal we want. Take the HBO GO availability. Per HBO's obstinance regarding a standalone streaming service, only viewers who subscribe to HBO through certain cable or satellite providers get access. So the box just puts the TV we already buy on our boxes -- not ideal. Or, as happened with Dish Network, as the company gets bigger names other TV providers worry. The Dish add-ons meant that other channels had to go, according to TechCrunch's Ryan Lawler. As Roku deepens its relationship with News Corp. and BskyB it could alienate others. However, having a big media owner like News Corp. on board could provide the right stuff.
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Unfortunately, News Corp. suggests this relationship will just give us more offerings, but nowhere near all. News Corp. Chief Digital Officer Jon Miller assured The Wall Street Journal's Don Clark that the service doesn't intend to replace the existing pay-TV model, calling it an "additive." We don't want additive, because then we might as well pay for cable, we want replacement. Yet, there is still this bit of hope. "We think all cable content will be on our boxes in the not-to-distant future," Roku CEO Anthony Wood told Clark. As long as that doesn't involve paying for the entire cable package -- our little pipe dream -- that sounds like just what we're looking for.
