1. Roku Moves Into Smart Home Territory

So Dave Zatz, a tech blogger whose ZatzNotFunny blog is well worth your while, uncovered some patents that showed that Roku is partnering with Wyze to create a line of smart home products.

What’s interesting though is that the products, which include smart bulbs and security cameras are only tangentially related to watching TV.

Yes, you could technically use the bulbs to set the mood in your home theater and have the output from your security cameras play on your TV, but it’s unclear (to me anyway) why you’d want to.

Mostly it seems like Roku is dipping its toes into the water for ways to expand its brand beyond TVs. Which would perhaps indicate that they are looking for alternative revenue streams of the sort that would make them more attractive to a suitor.

Why It Matters

For years now, “who should buy Roku?” has been a favorite parlor game among industry observers. Guesses range from TV manufacturers (Sony) to programmers (pretty much all of them, but Netflix and Disney in particular) to tech companies (again, pretty much all of them) to retailers like Walmart.

Truth is there are arguments to be made in favor of just about anyone buying Roku, with Buyers Who Can Help Them Break Into Overseas Markets having a slight edge. (While Roku has launched in Europe, growth there has been slow and they do not enjoy anywhere close to the sort of name recognition they have in the U.S.)

As of today, Friday, October 14, 2022, I am thinking that Microsoft would make the most sense, given that they appear to be re-engaging with the TV industry (that Netflix/Xandr deal) but lack a TV operating system, which, as we shall see in the next story, is the key to everything in TV right now.

Merger rumors aside, smart TV OEMs have been looking at how to make the TV the center of the smart home for a while now. The idea there is that the TV will be able to do everything from Zoom calls to exercise videos to ordering food for the smart fridge and adjusting the smart blinds to create the most optimal lighting.

That’s the idea anyway. Consumers have not seemed to be all that enthused about it yet, largely because the peripherals needed to make the smart TV into a hub have not lived up to their hype yet. (Replacing your current refrigerator with a smart fridge is also quite costly.)

Which is not to say that it will never happen, just that it’s not there yet.

As for Roku, the move is curious in that it seems, from a consumer POV anyway, that being able to interface with Alexa is the key to any smart home device, Alexa being the most popular of the smart home speakers. Plus, given that there are many perfectly functional smart bulbs and cameras on the market already, it’s unclear what Roku’s bulbs and cameras will do differently. 

Or to put it in real world terms, is the ability to turn on the hall light from your TV going to be a major factor in anyone’s purchase decisions? It wouldn’t be one of mine, but maybe others feel differently. (I would also not discount that Roku may be trying to make themselves more attractive for Walmart, which definitely would like to compete with Amazon.)

Regardless, the key takeaway here seems to be that Roku is always innovating and trying to get ahead of the curve, likely in the hopes of making themselves an even more attractive takeover target.

So there’s that

What You Need To Do About It

If you’re Roku, you probably weren’t expecting Dave Zatz to be such a good reporter and so now your best bet would seem to be to hustle out an announcement about what you’re up to.

Or not—I suspect if you ignore the scoop because the actual product is still many months off, that everyone will have forgotten about it by next week.

If you are one of the other TV OEMs, one of the ones who actually own their own hardware, there’s probably nothing to do here. Most of you have global businesses selling a wide range of electronics and home appliances and have no doubt been looking at what you could be doing in terms of smart home devices and how rolling them out would impact your bottom line.

If you’re a consumer and you’re something of a gadget geek, this is good news in that the more competition there is, the more likely prices are to remain sane.

2. Samsung Opens Up Their TV OS

In the latest salvo of the Streaming Wars, Samsung announced that it was going to open up its Tizen TV operating system to third parties.

As TVREV readers know, the battle over the operating system is the key skirmish to keep an eye on, because whoever controls the majority of TV operating systems is going to be in the catbird seat and then some.

That’s because the OEMs are going to be the new gatekeepers. Their FAST services will form the core of their interfaces and they will be able to recommend shows and services, using data to try and create a superior experience for consumers and advertisers alike.

Why It Matters

Right now the opportunity here is mostly international—both in Europe where Google and Amazon have been arming up, and in emerging economies where the field is still wide open as much of the market, such that it is, is controlled by smaller local manufacturers.

Samsung’s play parallels recent moves by LG, who expanded its webOS operating system to around 200 gadget makers after making its TVOS available to other manufacturers. (As per Omdia, LG controls about 20 percent of the world’s TVOS market.)

Xperi, the company that owns TiVo has also been making moves, offering up the TiVo OS to the aforementioned smaller international OEMs as an affordable alternative.

All that said, the game here, at least outside of the U.S., really comes down to the tech giants—Google and Amazon versus the consumer electronics giants—Samsung and LG. There are many factors at play but the most important is going to be the ability to provide an interface that consumers actually like to the point where it becomes a major factor in their purchase decision.

Which is why I’m thinking the CE guys have the edge…and why it makes sense for Microsoft to buy Roku.

But I digress…

What You Need To Do About It 

If you’re one of those consumer electronics guys (or if, like VIZIO and Roku, making TVs is your jam) you need to continue to prove me right here and keep staying on top of the user experience, making it easy for viewers to find what they want to watch and to move to a new device without much hassle. Invest in your FASTs, especially in personalization. Look to Spotify as a guide as to how personalization works to create loyalty.

If you’re one of the tech guys, remember that TV is different than the internet, that people have much more of an emotional connection to TV shows and that while using data to improve the customer experience is a good move, too much of it can start to feel creepy.

If you’re an OEM in an emerging economy, you have a whole lot of suitors. Do not try to make your own OS. Just do what you are likely already doing: figuring out what consumers in your market want and then finding which of the TVOS’s matches best.

If you’re a programmer—an SVOD, FAST or TV network—keep an eye on what the TVOS players are up to and who is winning and who is losing. TVOS is going to have a lot to do with whether or not you succeed, so best to understand where that sector is heading.