Roku Scores Best Buy Distribution Deal

Roku is announcing this morning that its Roku XD streaming player will be available at Best Buy stores nationwide. The deal is a big win for Roku which has primarily relied on online sales to drive over 1 million units to date. The price point for the Roku XD, which delivers up to 1080p HD using 802.11n WiFi will be $79.99, the same as online.

I've been using the XD device for a while now and it performs nicely. The biggest question mark I've had about Roku has been around its ability to compete in a very noisy consumer electronics environment, dominated by giants with well-known brands. Lately the success of Apple TV, which also retails for under $100, has felt like it could squeeze Roku, especially given the popularity of Apple's stores, which have no doubt helped introduce many to the Apple TV product. Because Roku only had limited hands-on opportunities, primarily early adopters would be drawn to its players.

The Best Buy deal changes that dynamic. While online price comparing and buying are hugely popular, the reality is that for many mainstream buyers, a trip to Best Buy remains the way they get educated and introduced to new technologies and gadgets. Best Buy recognizes this and puts a huge effort behind customer education (to Best Buy's chagrin though, they provide this service while needing to remain price competitive with online and support the store infrastructure, all of which is a huge challenge). Depending on how well promoted the Roku device is, both in-store and in Sunday inserts, Roku could gain exposure to millions of new customers. The fact that it's a relatively inexpensive device, compared to say the Logitech Revue box with Google TV, which retails for $300, is another key benefit.

With the Best Buy deal, Roku continues to prove itself a plucky upstart. It has continued to be aggressive on the content front, just this week becoming one of the devices chosen by Sony's Crackle to carry full-length, ad-supported movies such as "The Da Vinci Code," "Ghostbusters," and "A Few Good Men." Roku announced earlier this year that it has delivered over 1 billion streams and that its players are used more than 11 hours per week. It has also moved to position itself as an "open" solution, in contrast to say Apple TV, offering content providers easy access to set up their own channels. One of the things Roku now needs to do is offer an "AirPlay" like feature (likely for Android devices), allowing connections between its players and portable devices for instant video sharing. No doubt they're already thinking about this.

Add it all up and Roku is proving it can stay in high-stakes game for connected devices.

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Categories: Commerce, Devices

Topics: Best Buy, Crackle, Roku