Roku teams with Amazon to stream videos

March 4, 2009 By Troy Wolverton

Roku, maker of a $100 box that delivers streaming Netflix videos to consumers' TVs, is teaming with Amazon.com to vastly increase the number of movies and TV episodes consumers can watch through the device.

The partnership may bring the digital living room one step closer to reality. That's the idea of making available a universe of movies, TV shows, music and other content on consumers' entertainment centers at the touch of a button.

"It's a significant step," said Kurt Scherf, vice president and principal analyst at Parks Associates, a research and consulting firm.

Later this week, owners of the Roku Netflix Player _ which has been renamed the Digital Video Player _ will be able to use the gadget to watch videos rented or bought from Amazon.com Roku will add the feature to existing devices with a free, automatic, Internet-delivered update, and it will be built in to new models of the player.

The deal with Amazon will allow Roku owners to gain access to 40,000 videos from the online store in addition to the 12,000 videos available from Netflix.

The partnership also introduces another option for Roku owners. Previously, they could watch videos through the device only if they had a Netflix subscription, which costs $9 a month and up. Now, they will be able to get videos on an a la carte basis from Amazon.

Amazon charges $3 to $4 to rent most movies and $1 to $2 to rent TV episodes.

Consumers can also buy digital movies from the company for $6 and up. Amazon stores both rented and purchased movies on its Web site and will stream them to Roku boxes, which don't have a hard drive.

Roku owners will also get to watch movies in a more timely manner. Amazon's video service tends to get new videos on the same day that they are available on DVD or, with television shows, the day after they air. Netflix tends not to have movies available for streaming until days or weeks after they are released on DVD.

The move may be the first of many for Saratoga, Calif.-based Roku. The company is working with other big _ but unnamed _ content providers to allow consumers to gain access to their services through the video player, said Tim Twerdahl, the company's vice president of consumer products. Also, Roku plans to open up the device this summer so that service providers can add a channel to it on their own, Twerdahl said.

"We believe that the future is everything is available on demand from the (Internet)," he said

However, Roku has a way to go to see that vision through. Even after the new deal with Amazon, Roku's video player will not have access to what has become the most popular form of online video: free streaming movies and TV episodes provided by YouTube, Hulu and other sites.

Nor does the device do anything other than play video. Unlike Apple TV or the various TiVo DVRs, Roku's video player doesn't play music or display photographs. And unlike Microsoft's Xbox 360 or Sony's PlayStation 3, which both offer digital video services, Roku's device won't play games.

Still, analysts say that the deals with Netflix and now Amazon should give consumers an indication of what the device _ and potential competitors like it _ will be able to do in the future and where the digital living room is heading.

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