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Summary:

Twelve percent of Roku’s customers have canceled their cable TV subscription, and many others have cut bakc on their monthly pay TV spending, according to Roku’s CEO Anthony Wood. Check out the video interview we did with Wood when he visited our office earlier this week.

anthony wood

One out of five Roku users has canceled or reduced his pay TV subscription, according to the company’s CEO Anthony Wood. Wood stopped by our office this week to showcase Roku’s new line of devices, and he shared some internal research during our interview, revealing that eleven to twelve percent of Roku’s customers have completely canceled their cable. About the same percentage have reduced their pay TV bill. “Roku is a great replacement for traditional pay cable content,” he said. Watch the entire interview below:

So what are all those cord cutters doing with their Roku boxes? It’s no surprise that Netflix is the most popular Roku channel, but the runner-up is a little unexpected, considering that we’re talking about a video player: it turns out that Roku’s users really, really love Pandora.

Wood said that he was a little skeptical at first about whether users would listen to music on their TVs, but Pandora and other music channels like MOG have proven to be really popular. “It turns out that people don’t have stereos anymore,” he explained. In third place is Amazon’s Video on Demand, according to Wood, and Revision3 is also in the Top 10.

We also talked about the competitive landscape, which is going to get a lot more interesting with the introduction of Google TV and Apple TV later this fall. Wood pointed out that Roku has the advantage of a proven track record that will help it to compete. “We are closing in on a million units sold,” he said.

For more on the Roku product updates, please also check Video: What’s New On the New Roku

Related content on GigaOm Pro (subscription required):

Cord-cutting? Hold the Phone

Google TV: Overview and Strategic Analysis

New Business Models For Pay TV Services

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  1. How did they determine that number…?

    1. He says they surveyed their customers….

      1. I’m a customer, and don’t recall seeing a survey. Wonder what number or percent of customers they hit and if they can accurately extrapolate to all.

  2. Are you serious – 12%? If they are closing in on a million units sold they are saying that 120,000 people (potentially) canceled their cable? I don’t believe it (and I own a Roku). I use my Roku strictly for Netflix (why we bought it), and for the occasional Amazon on Demand movie. How the heck else could you use to replace all the things cable supplies: MTV, VH1, USA, Bio, Fox, HGTV, and the list goes on and on…I just don’t get it. Did these people just not watch TV?

    1. Believe or not, but many people don’t care for MTV, VH1 and TV Shows. Anyway, most of shows are available online via hulu and CBS own site. What’s really missing is sports and Disney channel. Everything else you can consume on-line. In my case, I don’t cut cable because of Disney. Kids love it and Netflix and hulu can’t replace it anyhow.

  3. That number seems high to me, unless people really rely on Netflix that heavily. If this is true, this is certainly encouraging for Web TV!

  4. I think 12% is reasonable, but I also think it understates what could potential happen. One of the reasons why all of these streaming boxes (like Roku) struggle is that they are trying to go against Cable/Satellite TV with just OTT content.

    Why ignore OTA? Hasn’t anybody heard of digital broadcast TV? Sure, scoff if you want to but if you have seen what digital broadcast TV looks like you would stop laughing. The bigger your TV the more you will appreciate how good OTA really is. In major metro areas, there are quite a few TV channels to choose from (I currently get 67!). All free thank you!

    Now, easily combine OTA and OTT and that would get the Cable companies to wake up real fast. Furthermore, get a OTT box that really isn’t limited to any one service provider and you have something that is really worrysome.

    It is a great time to be a cord cutter, just keep an open mind and use all of the sources available.

    I’ve currently started a series on surviving without Cable (with a Media PC). Join me on No-Pay-TV Island and see if you can make it too.

    http://www.cuttingthebills.com/2010/09/cut-cord-survival-guide.html

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  6. Hulu Plus Definitely Coming to Roku and TiVO: Video « Tuesday, September 28, 2010

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  7. REALITY CHECK to all techno-utopians out there that think these devices will in any way alter your life:

    Cord-cutting your TV? Guess what–the cable company is just going to raise your Internet bill that your precious over-the-top device owns. Now, you’ve lost your live TV, and you have a substandard, slower, more cumbersome video product compared to TV.

    Sorry, there’s no way around it, you are owned. That is of course, unless you want to invest billions of dollars in network infrastructure like the cable industry has.

  8. Put me in the 12% that cut down cut back my cable. There’s some things I don’t see anymore but other stuff I didn’t have. I haven’t had it long but so far I don’t miss the other channels at all. Instead of mindlessly channel surfing to “I love the 80’s” I mindlessly channel surf through YouTube. It wastes your time just as effectively.

    The cable company can’t really up my internet bill unless they up everybody’s bill. I’ll deal with that when the time comes and enjoy the savings in the meantime. The box pays for itself in 1 1/2 months.

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