More than 30 million people use a Roku device to navigate the constellation of streaming TV services. The company’s portfolio includes the “stick” ($49.99), which resembles a USB drive; the “puck” ($79.99), a black square with smooth edges and minimal detailing; and a $400 smart TV with Roku Inc.’s operating system. The more expensive options offer better image quality and such features as extra digital storage space.
As the era of cable and satellite TV dims, Chief Executive Officer Anthony Wood says Roku is poised to keep capitalizing on the boom in streaming video. It’s an independent player that can work well with all the entrants, he says, including new services from Disney and Apple and forthcoming ones from AT&T and Comcast. “It’s satisfying to see the world be all-in on streaming,” says Wood. “That’s nothing but excellent for Roku.” Many investors on Wall Street agree: The company’s stock is up more than 300% this year, and Roku is valued at over $17 billion.
Having built the dominant box, Roku is under siege from companies that recognize the value of its business model. Google sells a competing smart TV operating system. Samsung sells more than a dozen smart TVs that don’t use Roku’s operating system. Comcast Corp. is giving its internet subscribers a free streaming box. AT&T Inc. is offering a box for its customers. Apple Inc. is investing billions in streaming shows designed in part to strengthen the appeal of its hardware. But Roku’s biggest challenger is Amazon.com Inc., which is vying for tie-in deals for its Fire TV with smart TV manufacturers and battling for supremacy in international markets. In September it announced a major expansion in Europe, where Roku is less dominant.
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