Roku adds Amazon Video on Demand

The Roku Digital Video Player has just gotten a whole lot more interesting.

The company announced Tuesday that it is adding more than 40,000 movies and TV shows to its online video service from Amazon Video on Demand.

Roku launched its $99 digital video player in May with Netflix as its first streaming partner. For a monthly fee, consumers can watch any of Netflix's 12,000 movies and TV shows in its library.

The company said it had sold out of the device in the first two weeks after it went on sale. And since then, sales have been strong, said Tim Twerdahl, vice president of consumer products for Roku.

The company won't release specific sales figures, but Twerdahl said the company has sold well over 100,000 devices in the past nine months.

While this is certainly a good start, the Roku box could become even more popular as more content is added to the platform. The Netflix deal has been a good start, but the service only offers a fraction of its overall DVD library for streaming.

Roku Digital Video Player

The deal with Amazon is key because it not only offers a much larger library of content, but it also offers hot new titles, many of which are released on Amazon's download service when they're made available on DVD.

Amazon's service also offers a different business model. Instead, of a subscription service, the Amazon service will allow users to rent movies on demand for about $2.99 to $3.99 a movie. Here's how it works. The Roku player connects directly to any TV and uses a broadband Internet connection to deliver streamed DVD-quality video to the TV. The device also has a Wi-Fi connection, which can simplify the set-up and provide Internet connectivity even a room where there's not an Internet hook-up.

Users can browse Amazon's Video on Demand menu right form the TV, or they can watch movies or TV shows that have already been downloaded from the service to their computers. Current Roku customers will receive a free and automatic update so they can access the Amazon Video on Demand service.

Twerdahl says the Netflix and Amazon deals are just the beginning for Roku. Ultimately, he said Roku hopes to provide consumers with a replacement for cable service.

"Our mission is to help you cut your cable cord," he said. "We want you to be able to watch anything from the Internet on your TV. And we are working with content providers and we'll be releasing an SDK soon to allow content owners to create their own channels."

Specifically, Twerdahl said Roku is talking to the big TV networks, such as ABC, NBC, CBS, and Fox, to bring current TV programs and live TV events via the Internet. He said this programming would likely be supported by advertising.

In addition to TV, Roku also plans to add access to other services, like Internet radio or online picture sharing. This would allow people to listen to music services, such as Pandora, through their TV or view photos from services like Flikr or Snapfish.

The key to Roku's long-term success will be in its ability to score deals with all the major content publishers and distributors. Once it's able to do that, it could become a legitimate replacement for cable TV services.

But Roku still has a long road ahead of it. For one, it's not the only company going after this market. Both Apple and Microsoft have their eye on it; Apple with its AppleTV platform and Microsoft with the Xbox. And the cable companies themselves are also talking about offering some video content via broadband.

So far, Roku appears to be on a good path. For one, it has priced its product at $99, much cheaper than either Apple and Microsoft. Second, it is using a mix of business models to appeal to different consumers. The Netflix service is a subscription service. The Amazon deal is rent-on-demand. And future content offered by TV networks and through niche channels will likely to be advertising supported. A mixture of business models, along with access to a wide range of content, could make Roku a strong player in the video broadband market.

Roku is also working directly with content owners and distributors, which means it is avoiding some of the troubles that other online video companies are facing. For example, Boxee, which provides a free, one-stop user interface for watching video from a variety of sources, never had explicit deals with some content distributors or owners, and it recently got burned. Last month, Hulu.com, removed itself from Boxee's media center platform. Apple TV has also prevented its service from running on its box.

Read the CNET review of the Roku Digital Video Player.

[thenet411]

My Roku box has been a solid performer since I installed it almost a year ago. It sits quietly waiting to be used when my DVR is empty and always has a nice selection of movies to watch via Netflix. Never had any video quality problems or technical glitches. With the Amazon DVDs coming out on release day in addition to being cheaper than PPV, I think PPV for me will be a thing of the past.

[DaveMcLain]

I was in the beta test group for Amazon on the Roku box. The service works well. I had tried their Unboxed service a year or two ago and I had bought a few shows at that time. They show up in my que on the Roku box in the Amazon section which is very cool. The quality of both the Amazon and Netflix content is very high and seems to be getting better with time the encodes look smoother even at reduced bit rates. I find it interesting that there are now two different models of similar concept running on the same box. Netflix, pay a fee watch as much as you want. Amazon, pay as you go. Only pay for what you watch. It'll be interesting to see which model works best for most people but for my needs I tend to favor the Netflix system.

A great little box that does a lot for $100.

[mattumanu]

I think it's not out of reach to think that both models can coexist. Let's say I start watching a series on netflix, then decide I want to own that series. I can then go to amazon and purchase that series for myself.

[bigmikenco]

** So I use Netflix (1 disc at a time) and a box to stream Netflix to my TV, and it cost me $10 a month. I'm pretty sure if you added up everything I watch in a month and priced it per item at amazon it would be WAY over $10 bucks. I'm not feelin it. Between Netflix and hulu.com I don't know why I would want this. Now if only Apple would adopt a subscription service for their music and video my joy would be complete, but I'd be better off waiting for Steve Jobs to personally deliver my music to my house in a giant apple suit.

[blusky08]

Cable television companies better wake up and offer more bang for the buck--ala carte, NEW programming and lower prices. Cable channels are not making new quality programming. Reruns, reruns, reruns--and more reruns. Not just reruns, but reruns of programming that wasn't worth watching the first time around!
I have a $100/mo. cable package about to be cancelled.
REALIZATION: You can get more of what you want by spending less with download services and DVDs.

[al4video]

Cable television companies are loving this. Since most of us get INTERNET service from the same cable provider. No sooner then we get hooked on these kind of services, our cable providers are going to adjust our rates according to bandwidth set by them. I personally would think that Netflix and every other company that uses this business model should ante up for the extra bandwidth. There's no way out. The cable companies are a huge greedy monopoly.

[tdaloisio]

I can't wait to set this up and be able to stream in movies on demand at the time of DVD release for lower prices than an HD On Demand viewing from Comcast. Will this redefine my viewing habits? Probably not. Will it augment them nicely? Absolutely.

[chowbiz]

While recognizing that this is an article about Roku, isn't the box really just bit of software on top of hardware already on my....Sony Playstation 3? I'm using both TVersity and PlayOn to stream from either my desktop and from Netflix. Since these also work on XBox, not sure I see the value of yet another box (which is why I went for the PS3 and eliminated the need for a disc player and got blu-ray all at the same time). Now if I can figure out a way to get Amazon over the PS3, I'll be one very happy guy (who doesn't own more than 2 games).

[LenSp]

What timing for you -- Playon added Amazon VOD this weekend. If you haven't already, download the latest update.

I think the Roku works well for the second, third, etal. TV's in a house. Computers cost several times more so a Roku is a nice alternative for those TV's especially if it means having to pay one less cable box fee for that extra TV.

[BCF1968]

So this thing has no storage capacity? Strictly streaming? So someone that doesn't have access to broadband this is really a useless thing then.

[Barbara4934]

Please tell me how to obtain a pin number for my roku amazon video. Thanks. [e-mail]

[cataEye]

Hello:

We are also using Roku trying to integrate our video content with this technology.I know YouTube works on something similar (not with Roku) but I don't think it can support HD as a part of their streaming options. I like Roku HD XR because of the extended range Wireless-N incorporated which wasnt't available on the other 2 versions, Roku SD and Roku HD boxes. We already have a Roku box and I testing it's capabilities. You can have a look at www.thehdstandard.com for some of the results.

______________________________________________
Catalin
EyePartner Streaming Consultant