Roku on Monday announced a flurry of new product debuts and software enhancements, which include the latest iterations of its operating system and high-end OTT player, the introduction of a new lower priced smart sound bar, and the rollout of a Roku Channel mobile app that works regardless of whether the user owns Roku hardware. 

First, the Software

The streaming company will start rolling out over the coming weeks its latest operating system, OS 9.4. And perhaps the most notable OS upgrade is one that hasn’t arrived yet. Roku said support for Apple AirPlay and HomeKit will debut “later this year” on “select 4K Roku devices.” 

AirPlay2 will allow Roku users to stream, control and share content on Roku devices from their Apple iPhone, iPad or Mac computers. HomeKit will allow these same users to control their Roku device using the Home app, with Siri voice, on iPhones, iPads, Mac computers and Apple Watches. 

Among usability feature improvements for OS 9.4, users of Roku-powered smart TVs will now be able to access the Live TV Channel Guide directly from the home screen (as opposed to going through the Roku Channel app). 

Starting Tuesday, Roku is adding 15 live-linear channels to its lineup, including Cinedigm's Bloody Disgusting TV, The Craftistry from Studio71, Circle, HappyKids.tv, Hi-YAH! - The Martial Arts Channel, iFood.tv, The Lego Channel, Maverick Black Cinema, MovieSphere, Skills + Thrills, VENN, WeatherSpy, as well as a variety of Spanish-language entertainment including Sony Canal Novelas, Sony Canal Comedias, and Sony Canal Compentencias from Sony Pictures Television and Tastemade en Español.

The software enhancements also include the rollout of a new iOS and Android app that will let users access the free-to-consumer, add-supported Roku Channel from smart phones and tablets, regardless of whether they own Roku hardware. 

About Roku Hardware

Roku fixed the common consumer pain point of getting the OTT player to connect to the living room sound bar a year ago, with the introduction of the Roku Smart Soundbar in September 2019. 

Roku integrated the chipset from its top-of-the-line Ultra OTT player into a premium, full-sized Bluetooth-enabled sound bar that included Dolby audio (Dolby Digital and Dolby Digital Plus). That device served as a lynchpin for a complete surround-sound system that also includes the Roku Wireless Subwoofer and the Roku Wireless Speakers. 

The Bluetooth connected audio system delivers premium sound and just works every time users fire up their TV. But it’s not cheap, starting with the $179.99 price for the Smart Sound Bar. 

Perhaps needing a more enticing price tag to hook users into its audio ecosystem, Roku is debuting the more diminutive Roku Streambar, which according to Sheldon Radford, director of product management for Roku, “fits nicely inside a Christmas stocking” and retails for only $129.99.

The Bluetooth-enabled sound bar  also includes Dolby Audio and an integrated Roku player with a quad-core processor. 

“Why would I pay an additional $50 for the Roku Smart Soundbar?” Next TV asked Radford.

“Aesthetically, you might decide that [the older, more expensive product] looks better with your bigger TV,” he said. 

Finally, Roku is upgrading its top-of-the-line player, the Roku Ultra, redesigning its WiFi antenna to give it 50% more reception range. The 4K-capable $99 device includes a quad-core processor and more memory, with support for HDR, 60 fps, as well as Dolby Vision and Dolby Atmos. 

One of the pain points of the modern flat-panel LED TV set is the audio. Picture quality for these newer model sets, which most often support 4K and High Dynamic Range, is better than ever. In a viciously competitive consumer-electronics market, though, it’s the picture that gets the investment.

And it’s not like there’s a lot of room for speakers within these thin devices anyway.

Thus, the sound bar and its associated subwoofer have become essential accessories for the owners of newer TV sets. Credit Roku, which seeks to maintain its leadership as the No. 1 global supplier of smart-TV user-interface software by making an, er, intelligent play in introducing its new Roku Smart Soundbar.

Retailing for $179 and available through Best Buy and Roku’s own e-commerce channel starting in October, the new device is a 32-inch Dolby Audio-equipped sound bar with HDMI ARC, Optical Audio, USB 2.0 and Bluetooth connectivity.

For another $179, you can turn up the bass with the Roku Smart Subwoofer, which contains a 10-inch driver and a digital amplifier with 250 watts of peak power.

“We’ve benchmarked this against other sound bars that are more expensive, and we’ve gone out and talked to consumers to really understand what the pain points are,” Mark Ely, vice president of whole-home product management for Roku, said.

Not Just a Hardware Play

Roku’s new sound bar embeds its most premium over-the-top player device, the 4K-capable Roku Ultra, right into the hardware. That means that if you own, say, a Samsung smart TV, you can use your new Roku sound bar to bypass the TV set’s native Samsung operating environment and use Roku’s OTT platform instead.

For Roku, it’s just another way to extend its control of the global OTT market. During its second-quarter earnings call, Roku said it had reached 30.5 million active user accounts as of the end of June. Research company Convivia reported last month that Roku’s operating environment powers 43% of the world’s connected TV devices — everything from smart TVs to HDMI dongles to the little boxes that sit on top of smart TVs.

Amazon Fire TV, which has the next biggest market share, controls only around 18% of connected TV devices, Convivia said.

For Roku, selling a bunch of $179 sound bars and subwoofers would be nice. But it’s really about the proliferation of the Roku ecosystem.

Roku generated $250.1 million in revenue in the second quarter, a 59% year-over-year uptick. The majority of that revenue, $167.1 million, was generated from “platform revenue”— that is, selling advertising on apps that exist in the Roku ecosystem, such as ad-supported VOD service The Roku Channel.

Roku’s fast-growing platform business is up 86% on a year-over-year basis in Q2. The hardware business isn’t too shabby, either, growing at 24% to $82.4 million. But Roklu’s business is increasingly about its operating system and selling ads within it. Hardware is also a means for Roku to expand its global reach.

Like Netflix, Starting in Brazil

Roku has a small presence in the U.K. and France, but the company’s real international effort is currently percolating. It plans a major Latin American push that will start out in Brazil, the same country where Netflix began its global advance in 2011.

Netflix is a company that only makes content apps that fit into ecosystems such as Roku’s. Roku makes the ecosystem, the apps that fill it up (like Roku Channel) and the hardware that enables it (like the sound bar). Unlike Netflix, though, Roku doesn’t make original content.

Still, Netflix is the OTT company that Roku is compared to most often these days.

On Nov. 1, 2011, Netflix stock bottomed out at $9.22 a share. Less than two months earlier, the subscription streaming company began its international expansion to 43 countries and territories in Central and South America, as well as the Caribbean. Brazil was Netflix’s first launch in Latin America on Sept. 5, 2011. As of midday trading on Sept. 3, Netflix shares were valued at $289.47.

Roku, which traded below $30 a share last year, was closing in on a stock price of $160 at press time.

“In our view, Roku will experience similar phased stages of international growth as Netflix did during its international expansion,” Ralph Schackart, internet and digital media analyst at Chicago-based investment bank William Blair & Co., said in a note to clients late last month.