Power

Roku wants to expand into smart home devices

The company's IoT plans include both partnerships and products developed in-house.

A TV sitting on a credenza with Roku’s interface on the screen.

Roku is already making sound bars. Now, the company is eyeing other smart home devices.

Photo: Roku

After becoming one of the biggest players in the living room, Roku is setting its sights on the rest of the home: The company has plans to expand into connected home technology, with job listings and a recent hire hinting at products being developed in-house. Roku may also be looking to partner with existing smart home manufacturers.

A Roku spokesperson pointed to the company's existing whole-home audio licensing program, but declined to comment further.

Earlier this year, Roku published a since-removed job listing for a "Director of Product Management, Home Technologies" that described an expansion into smart home technologies as a necessity to remain competitive. Potential applicants were told that their job duties would be to "develop [Roku's] home technology product strategy" and "develop [the company's] product roadmap," among other things.

The listing also suggested that the company's plan included a mix of first-party products and interoperability with existing products and frameworks. "The Director of Product Management, Home Technologies, will own the strategy and execution of products and features that connect Roku with home ecosystems more deeply," the company wrote in the listing.

This month, Roku filled this role with the hire of Damir Skripic, who joined the company from Amazon. Before that, he worked for nearly five years for TP-Link's Kasa Smart Home Unit as well as smart home security camera maker Arlo, according to his LinkedIn profile.

Roku is looking to further build out its home technologies team by hiring a senior business development manager tasked with striking partnerships with smart home hardware manufacturers. "You will be responsible for vetting new partners & developing partnerships to connect Roku with home ecosystems more deeply," a recently published job listing reads. Partnerships like these could help Roku play nice with third-party smart home tech, and for instance enable people to watch feeds of their security cameras on their smart TVs, or even control connected appliances directly from the TV.

Roku is best known for its streaming sticks and pucks, but the company has in recent years taken some steps to go beyond the TV screen. It launched its first wireless speakers in 2018, and has since expanded its audio portfolio to also include a wireless subwoofer as well as two soundbar products.

Roku's expansion into the smart speaker space has been driven by a team that joined the company through the acquisition of the Danish audio startup Dynastrom in 2017. The company has since continued to build out its team in Denmark, including through the hire of multiple former Bang & Olufsen employees. Members of the team are said to have begun talking to smart home appliance makers, according to an industry insider.

In addition to Dynastrom, Roku also purchased the intellectual property assets of Blackfire Research, a San Francisco-based startup specialized in wireless networking for smart home entertainment products, in late 2019. While Blackfire primarily pitched itself as a wireless solutions provider for audio companies like Harman, its website also touted its technology as applicable to "baby monitors, security systems, wearables, lights and sensors." The acquisition, which seems to have come after Blackfire ceased operations, hasn't been previously reported.

Building its own smart home devices won't be easy for Roku. The connected home market is competitive, and Roku already makes very little money with hardware sales. Instead, it has used streaming sticks and TVs powered by its operating system as a way to grow the audience for its platform business. In 2020, Roku's device business generated just $43.2 million in gross profit for the company. Ads and other services fees during the same time frame amounted to $764.6 million in gross profit.

However, Roku's advertising business also depends on people sticking with its platform, for which smart home support may become increasingly essential. Competitors like Amazon, Google and Samsung already feature support for security cameras and other smart home devices on their TV platforms. Apple just recently gave the new Apple TV a significant smart home upgrade, and both Amazon and Google have their own smart displays that can be used to both interact with streaming devices and control the smart home.

If consumers were to ditch their Roku sticks over a lack of smart home functionality, it could have a significant impact on the company's ad business — something Roku executives seem acutely aware of. "While we are well-positioned to help shape the future of television — including TV advertising — around the world, continued success relies on investing in IoT-driven technologies," the company wrote in a job listing.

Update: This story was updated to include a statement from Roku.

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