OTT.X Weekly E-Newsbrief

POWERED BY 43TWENTY

What Roku and Google are fighting about: Video codecs, voice search and millions of eyeballs 

Roku and Google are at it again: In an email to its users and in a statement sent out to media last week, Roku accused Google of anti-competitive behavior. The statement suggests that the search giant was using carriage negotiations for its YouTube TV service to enforce changes that would benefit its free YouTube app as well, and ultimately harm Roku’s business.

Roku’s timing for these allegations was impeccable: With Congress taking a closer look at possible anti-competitive behavior by the major tech companies, the last thing Google needs right now is more bad press.

However, Roku’s allegations were also a bit vague; a closer look at them reveals long-existing fault lines within the streaming and smart TV industry. So, what are the two companies fighting about?

 

The Take

It’s all about the codecs. Roku is alleging that Google is using the YouTube TV negotiations to push it to enforce hardware requirements for future Roku products that could make Roku devices more expensive. This allegation bears some extra weight because of Google’s own Chromecast TV streaming device, which is currently selling for $20 more than the cheapest Roku streamer.

At the core of this allegation appears to be Google’s decision to push hardware makers to adopt the AV1 codec, an open video codec that promises better-looking 4K videos at lower bitrates. As Protocol first reported in October, Google is requiring makers of Android TV devices to support AV1 starting this month. Additionally, Google also seems to push makers of smart TVs and streaming devices not based on Android TV to use AV1 for YouTube.

AV1 has strong cross-industry backing, including from companies like Netflix, Hulu, Amazon and Microsoft, and it’s widely expected that the industry will eventually support it across a wide range of devices and services. However, most current-generation streaming devices, including Google’s own Chromecast dongles, do not support AV1 decoding, and hardware makers may have to spend a few extra dollars on their devices going forward before economies of scale kick in.

Also worth noting: This is not the first rodeo for many in this industry. Google has long aggressively pushed for the adoption of more efficient and less costly codecs, and at times ruffled feathers doing so. For example, Google has long forced device makers to use the free VP9 codec for 4K YouTube streams. Apple resisted supporting VP9 for years, which resulted in 4K YouTube streams not being available on Apple TV devices. Ultimately, the two companies made peace, and Apple began supporting VP9 last year.

Voice search is contentious. Roku also alleges that Google aims to dictate how the streaming device maker treats voice search results. According to those allegations, Google wants to force Roku to only show YouTube results when someone launches a voice search from within the YouTube app. If, for instance, someone browses YouTube and then decides to listen to music, a voice query like “Play ‘Uptown Funk'” would open the song on YouTube, even if the consumer had set Pandora as their default music app.

Publishers frequently complain that a voice query can take someone out of the app, and present all kinds of results that aren’t relevant in that moment. If someone browses the Netflix app, for instance, and presses the microphone button to search for “House of Cards,” some smart TV platforms may present a list of results from across a variety of services that include options to buy the show as pay-per-view, despite the fact that Netflix streams it for free.

As part of its latest OS update, Roku is rolling out a new search experience that is supposed to address those concerns by showing two rows: one showing search results from within the app that is currently being accessed, and one highlighting results across Roku’s catalog of apps and services. The question now is whether Google can agree to this treatment.

It’s a matter of power. Key to Roku’s position is the allegation that Google is abusing its market power to push for significant concessions. YouTube is the second most-popular app on most smart TV platforms, closely following Netflix, and Roku alleges that the company is effectively using those eyeballs to force concessions that could negatively affect its business.

The streaming device maker also alleges that this is not the first time Google has done this. Google allegedly forced Roku to add a row of YouTube search results to its universal search UI, effectively making sure that people searching for a movie always also see YouTube results with the trailer and additional videos as results.

Those allegations speak to the power struggles between device platform makers and streaming services; big streaming services regularly push for special treatment from device makers. One example: Consumer electronics companies that want to carry Netflix on their smart TVs or streaming dongles are required to include a Netflix button on remote controls that ship with those devices.

Conflicts like these are poised to become more vicious as device makers move from being neutral platforms to publishers themselves, with Roku, Samsung and others all running their own streaming services. However, in the past, most of this played out backroom negotiations. With Washington waking up to the threat of Big Tech monopolies, we should also expect that there will be a lot more policy and regulatory attention to these kinds of deals, and in turn a lot more public squabbling.

What they’re saying: “Google is attempting to use its YouTube monopoly position to force Roku into accepting predatory, anti-competitive and discriminatory terms that will directly harm Roku and our users. Given antitrust suits against Google, investigations by competition authorities of anti-competitive behavior and Congressional hearings into Google’s practices, it should come as no surprise that Google is now demanding unfair and anti-competitive terms that harm Roku’s users,” a Roku spokesperson said via email Monday.

“We have been working with Roku in good faith to reach an agreement that benefits our viewers and their customers. Unfortunately, Roku often engages in these types of tactics in their negotiations. We’re disappointed that they chose to make baseless claims while we continue our ongoing negotiations. All of our work with them has been focused on ensuring a high quality and consistent experience for our viewers. We have made no requests to access user data or interfere with search results. We hope we can resolve this for the sake of our mutual users,” a YouTube TV spokesperson retorted.

Source: Protocol

 

 


Advertisement

43Twenty accelerates OTT businesses.

We are an OTT growth consultancy and digital marketing agency. We help media, entertainment, and technology companies unlock customer growth and revenue.

Discover more here or send us an email to schedule a meeting.


IN CASE YOU MISSED IT

Vizio Adds 10 Free AVOD Channels on SmartCast TVs. Media Play News

Tubi Branches Into Originals to Build on Record Growth Under New Owner Fox. Adweek

Hub: Average Consumer Nearing Six Different Video Sources in the Home. Media Play News

Crackle Announces Redesign and New AVOD Service. Adweek

By selling AOL and Yahoo, Verizon finally admitted its multibillion-dollar mistake. Protocol

Amazon Exclusive Rights to ‘Thursday Night Football’ to Begin in 2022 Instead of 2023. The Streamable

The EU is cracking down on Apple’s App Store. Is Congress next? Fast Company

YouTube is a media juggernaut that could soon equal Netflix in revenue. CNBC

Nearly $1bn of Global Programmatic Budget Spent on Unsafe Content. ExchangeWire.com

Cinedigm Announces Fandor Selects(TM), the World’s First NFT Film Label. Yahoo Finance