A Roku executive has downplayed the absence of two well-known and much-anticipated streaming services on its platform.
In an interview with Capital Market Laboratories this week, Roku’s chief financial executive Steve Louden said the streaming platform continues to have “the largest, most-engaged streaming audience in the U.S.” despite not supporting new streaming offerings from Comcast and AT&T’s WarnerMedia.
Those services, HBO Max and Peacock, have not been offered to Roku’s millions of users since they launched earlier this year, forcing Roku’s customers to use other devices or switch platforms to access those services.
Last year, AT&T announced HBO Max, a blockbuster streaming service that combined HBO’s original programming and licensed movies with other content from WarnerMedia. The expanded content is only available within the HBO Max app, though original and licensed HBO programming continues to be distributed on cable, satellite, streaming services and other third parties.
Prior to its launch, Roku had inked a long-term deal with AT&T to sell HBO subscriptions natively to users through its Roku Channel app. That agreement allowed Roku to distribute HBO content within its own app and collect a commission on HBO’s $15 a month subscription price.
A source familiar with negotiations between Roku and Amazon told The Desk in June that ongoing discussions were largely focused on Roku’s commission as well as access to HBO Max for customers who subscribe to HBO from within the Roku Channel. At one point, AT&T offered Roku the opportunity to give its subscribers access to the HBO Max app, but did so in exchange for Roku lowering its commission for sales from 30 percent to around 15 percent. Roku said no.
Discussions between Roku and Comcast over Peacock center on different terms — specifically, those involving commercial inventory on two of Peacock’s three ad-supported plans.
Roku’s agreement with other ad-supported streaming services, including Fox-owned Tubi TV, allow it to insert a small amount of its own ads when viewers stream a show or movie. Roku wants to impose that condition on Comcast for Peacock as well as a term that allows it to collect a certain amount of viewership data. Comcast was receptive to the idea of providing some viewership data but resisted Roku’s demand for commercial ad inventory, according to a source.
Roku is certainly not alone in its struggles with AT&T and Comcast: Amazon has also not made the services available to users of its Fire TV and tablet devices since they launched. Combined, Roku and Amazon account for around 70 percent of the streaming television hardware market, but Roku stands to lose more from a long-term dispute with AT&T and Comcast because it does not have a diverse hardware and service portfolio compared to Amazon.
Still, Louden believes Roku provides exceptional value for customers, telling Capital Market Laboratories that it is holding out for a deal that signals a “win-win-win” for his company, its partners and customers a like.
“We won’t always be the first, but we think we’re the best-positioned to be the largest platform — if not one of the largest platforms — for folks,” Louden said.
And anyway, Louden said, Roku is still the best streaming service because “we have the vast majority of important content by now.” He pointed specifically to Disney Plus, a startup streaming service that has attracted more than 30 million subscribers since it launched late last year.
Louden said one element of Disney’s success with Disney Plus was their early decision to distribute their app on Roku’s platform.
“It really just shows that we can add a lot of value to partners that lean into Roku, and so that’s heartening to see as well,” Louden said.