Good News, Roku, Streaming Media Is Catching On

Streaming media players are catching on among U.S. consumers -- and that’s good news for Roku, which is increasing its market share against competitors.

Increased familiarity and new entrants into the streaming media market (such as Amazon’s Fire TV) should push adoption of players into 25% of U.S. homes by 2015, according to Parks Associates. Among the popular makers, Roku accounted for nearly one-half (46%) of streaming media players sold in the U.S. last year, while the closest competitor (Apple TV) accounted for only 26%, according to the report.

Usage rates are about the same. Among U.S. broadband households with a streaming media player, 44% use a Roku player the most, compared with 26% using an Apple TV. (The gap has widened in the past year. Previously, 27% of streaming media player owners used a Roku, and 24% used Apple TV.) Roku’s early relationship with Netflix has given it an advantage that continues to carry over, says Barbara Kraus, director of research at Parks Associates.

“The first Roku box was called the ‘Netflix player,’” Kraus tells Marketing Daily. “There’s a longstanding relationship with Netflix there, even though Netflix can be found on virtually every streaming media player [now].” 

With familiarity and adoption increasing, Apple, which already is the global sales leader in the category (20 million units worldwide as of April 2014 vs. Roku’s 8 million, as of December 2013), will likely look to increase is presence through more marketing and a revamped product, Kraus says. After years of viewing Apple TV as secondary to its smartphones and tablets, Apple is likely to see the value in a streaming product, she says.

“They haven’t put a lot [of marketing] behind it. If you have a ‘hobby’ product, you’re going to give it that level of promotion,” Kraus says. “It’s suddenly become a strong market, with a lot of good companies competing in it. They’ve seen the value of their Apple TV.”

Meanwhile, Amazon, with its 244 million accounts, will also likely make a greater push, showing off how its product can provide exactly what consumers are looking for.

“Roku has built up a lot of goodwill in the market. But Amazon has 240 million active accounts, and 20 million Prime members who use their Prime streaming service,” Kraus says. “They also have the advantage of knowing what features to have in a streaming media player new to the market.”

Though streaming media adoption will continue steadily for the next few years, Kraus anticipates some pressure from the adoption of connected TVs, which provide many of the same services as the streaming media players. 

“Their growth will be tempered a bit with increased adoption of connected TVs,” she says. “I anticipate a slow, but steady, growth curve.”

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1 comment about "Good News, Roku, Streaming Media Is Catching On".
  1. len mullen from none , July 12, 2014 at 4:12 p.m.
    There is little 'good will' among the many whose Roku 2 XS was rendered useless by the last TWO updates. Roku's unwillingness to let users roll back to a working firmware, lack of commitment to fixing the problem, and unwillingness to admit there IS a problem has sent a lot of former customers to Amazon and Apple.