This premium-television business is getting nerve-wracking as 2012 revs up.
Right now, theres no clear path forward. Are traditional cable and satellite
services surviving? Are on-demand, streaming services like the much-maligned
Netflix (NASDAQ: NFLX ) going to take over the world, forcing all sides of the
business to reevaluate how to generate revenue from advertising? Shake your
Magic 8 Balland the answer is, Reply hazy, try again later. According to Credit
Suisse analyst Stefan Anninger, the entire multichannel TV-services business,
from Time Warner Cable (NYSE: TWC ) to DirecTV (NASDAQ: DTV ), remained
completely flat from September 2010 through September 2011. There are 100.8
million pay TV subscribers out there. Meanwhile, a survey conducted by research
group Deloitte claims that 9 million subscribers stopped their pay-TV service in
2011 in favor of streaming alternatives like Netflix, Hulu, and Amazon s
(NASDAQ: AMZN ) Amazon Prime. Thats a massive discrepancy that illustrates the
one certain point: Change is afoot. Old and new need to meet somewhere in the
middle to keep consumers happy and advertisers spending, and the key to that is
making the service even cheaper and more accessible. To that end, Roku is
blazing a promising trail. Its latest device could be a game-changer. Roku make
a line of set-top boxes that plug into your television, not unlike TiVo s
(NASDAQ: TIVO ), but Rokus boxes are built specifically for streaming television
and entertainment services. The new Roku device isnt a box at all, though. On
Tuesday, the company announced its Streaming Stick , a tiny dongle that plugs
into an HDTVs HDMI port and provides the same range of service as more familiar
boxes. About the size of an eraser, the stick would seem to make turning a
regular TV into a Web-connected TV as simple as plugging it in. Like the boxes,
the stick offers a broad selection of channels. These range from free options
such as News Corp. (NASDAQ: NWS ) properties Fox News and Wall Street Journal
Live to additional premium services such as Netflix, HBOGo, Amazon Instant, and
NBA League Pass. This is in addition to other entertainment apps such as games (
Angry Birds ) and Internet radio ( Pandora (NYSE: P ). Roku also creates some of
its own content. The boxes are versatile and cheap, ranging in price from $50 to
$100. The Stick is also expected to fall in that price range. In the race to
bring television audiences to connected living-room viewing i.e., television
and entertainment from the Internet Roku has done an admirable job since its
boxes went on sale in 2008. The company has sold around 2.5 million Roku boxes,
putting it on par with
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