Roku Inc.
Streaming device and software maker Roku Inc. is breaking into new hardware that includes wireless speakers, a TV voice remote and tabletop voice remote.
The new offerings, announced Monday morning, fit into the company’s broad strategy of using its hardware line as a customer acquisition tool — a means to attract new users and then encourage them to spend more time streaming content. Roku ROKU, -1.21% executives have repeatedly said that the company’s future route to significant profit is through its platform, as it builds an ads- and licensing-based business.
“We see increasing engagement with TV, people are streaming more and they’re using their Roku products to consume more content than the year before,” Roku’s general manager of TV and players Chas Smith said. “It’s a bet from us that by making the TV more engaging, people will use it more and they’ll be more interested in what they watch. [The new hardware] will give them a higher satisfaction and it drives our platform business.”
Roku’s new speaker hardware bundle is designed to work only with TVs that use Roku’s operating system — manufacturers pay Roku to license the platform. The speakers will not work with the company’s line of streaming dongles and boxes, executives said, which Roku has been cutting markups on to acquire customers.
Roku declined to say whether the company will produce the new hardware at a profit, but Smith did say that there was no change from Chief Executive Anthony Wood’s earlier statements that hardware would continue to add to the company’s bottom line. For the first time in 2018, Roku’s “Platform” revenue — which also includes advertising and other revenue — exceeded its hardware sales.
The Roku TV Wireless Speakers use Roku’s Connect technology that gives “tight audio-video” synchronization with the Roku-powered TV, and the only cord required is one for pushing power to the speakers. The tissue-box-sized speakers also support Bluetooth, which will let consumers stream content from their mobile phones and tablets.
The tabletop voice remote, called Roku Touch, is about the size of one of Amazon.com Inc.’s AMZN, +0.89% Echo Dot devices, though unlike the Dot, Touch requires a person to push a button to activate its voice assistant. Like the voice remote, the Touch is battery powered by two AAs that should last about six months, Smith said.
Roku announced its new voice assistant product in January, and said at that time it would also seek to license it to other speaker manufacturers.
Roku will begin selling the new gadget package on Roku.com at a preorder price of $149.99 until July 24; $179.99 until Aug. 15; and $199.99 after.
Roku stock is up 49.2% in the past three months, as the S&P 500 index SPX, -0.05% has gained 5.5%.