I’ve been a big fan of Stratechery/Sharp Tech. One of their recent podcasts talked about how Youtube TV could be the big winner from the death of cable. The question I had when thinking this through is why not Roku?
The Problem with Streaming
I recently wrote about Peacock’s crazy streaming efforts. What’s apparent in the push for 5th place is that people are going to subscribe to multiple streaming services. Personally here’s what I have:
- Netflix (thanks Mom)
- Amazon Prime
- HBO Max
- Disney+ (thanks sister)
- Hulu (Wife gets with her Spotify subscription)
This might be a little extreme, but I think it’s pretty normal to have three different streaming services and these are increasingly going towards a freemium model. And… better yet none of these have sports or news… the final two things trying to hold together the cable bundle. Is the future a series of different apps?
It’s been a common joke that after the great unbundling (a.k.a the death of cable)… will come the re-bundle. My hope is that we end up in a better space than we were and an aggregator will be best positioned to make that happen. The idea would be one operating system that will let you seamlessly switch between streaming, help find new shows, etc… Essentially, we bring back channel flipping (aka discovery)! The idea would be an easy interface to find / discover content you pay for and easily add extra “channels” (aka streaming services).
So who is best positioned? To me – it comes down to YouTube TV or Roku. I’ll make the case for Roku.
The case is simple – they have the hardware and the software, which is a very powerful combination. They’ve aggregated a massive user base and recently shared that of all TVs sold in US – 43% are Roku enabled. They could leverage that user base and user friendly software experience into building
The benefits of this would be obvious for Roku. They would gain an immense amount of leverage over streamers. Obviously Netflix will go kicking and screaming into this partnership. You want to be as close to the customer as possible and Roku getting in the middle would be a rough ending spot.
Interestingly enough, Apple TV tried this close to a decade ago.. but it never worked out. I’m not sure this will ever happen, but customers would benefit from this and I’m not sure any streamer beyond Netflix has much leverage here.
I’m not saying that Roku will end up the winner here, but they seem the best positioned out of anyone. I don’t put a ton of hope into the idea of Roku being the integrator of all these apps, but I think it needs to be done.
The bigger bull case for Roku seems to be that they are positioned to be an aggregator…. even if it isn’t this kind of aggregation.