Roku launches $49 box, insists it’s not a loss leader

Roku LT

Roku is launching a $49 entry-level model of its streaming media player that will be sold online as well as in retail stores. A set-top box for half the price of an Apple TV may sound like a sure loss leader, but Roku CEO Anthony Wood insisted during a phone conversation Monday that this isn’t the case. “We are making money on every box we sell,” said Wood.

The new Roku LT will be able to display video with 720p and have access to most of the Roku channel store, with the exception of the casual games the company recently launched. That’s because it doesn’t come with Bluetooth support, which is necessary to use any of Roku’s new gaming remote controls. The device also doesn’t offer any SD card slot or Ethernet port, but comes with Wifi built in.

Roku also announced the launch of an HBO Go channel on Tuesday. It’s the second TV Everywhere offering on the box after Epix; viewers of both services have to authenticate themselves as pay TV subscribers first before they have access to the respective content. The channel will be available on all Roku devices, including the legacy boxes.

Wood had previously told me that a significant number of the company’s customers have cut the cord. On Monday, he reiterated that point, only to turn it into a sales pitch for TV Everywhere: “20 percent have canceled their cable, but 80 percent still have cable,” he told me, adding that Epix has proven to be extremely popular on Roku — something that even caught Wood by surprise. “This is a big deal,” he said. “Lots of people want this content.”

Check out the video below for a closer look at the Roku 2 the company launched earlier this summer:


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