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There are a couple ways for a tech company to get its hands on TV programming: Pay the TV networks a fee and re-sell those networks to consumers (See: Google, AT&T, Hulu, etc) or declare that “TV = apps” and let the networks and consumers figure it out for themselves.
Roku has a third way: Tell TV-watchers to get their hands on a broadcast antenna, then give them an easy way to watch the shows that antenna delivers.
That’s a new option on display in Roku’s newest operating system, which is coming to Roku-branded TVs today: Roku’s OS 8 features a “smart guide” that melds streaming options like Netflix and Amazon video alongside live TV networks like CBS and ABC.
That means Roku TV watchers who have connected an HDTV antenna to their set can easily see what’s available on broadcast TV. And when they search for a specific show or movie, they’ll see free TV options alongside streaming services. And they can get the free options using the same remote, without having worry about switching inputs or other hassles.
Roku isn’t the only service out there that blends live TV with streaming services. Comcast* and other pay TV providers now integrate Netflix and YouTube with their channel guides.
The difference is that pay TV providers want you to pay for TV. Roku is making it easier to get it for free, as long as you’re willing to go get an antenna.
A few years ago, that might have sounded like an odd purchase for someone in the digital age, but no longer: As people figure out that free-over-the-air TV is a real thing, antenna sales are picking up. Now an estimated 15 percent of broadband-only homes own one.
Meanwhile this is a nice differentiator for newly-public Roku, now valued at more than $2.4 billion. The bulk of Roku’s hardware sales come from cheap boxes and dongles (it has a new refresh of that line out today), but it is also trying to get consumers to buy TV sets with its operating system baked right in.
And the more people that use Roku’s hardware, the more people that use its software to buy programs or watch ads — where it plans on making real money.
*Comcast’s NBCUniversal is an investor in Vox Media, which owns this site.