Roku wants companies to sponsor a new promo reel feature

The Roku homepage as displayed on a smart TV. (Graphic by The Desk)

Executives at Roku have held discussions with advertisement agencies about a new video series that will spotlight ad-supported and subscription content available through the streaming company’s platform, according to a new report.

The video series, called “Roku Recommends,” will promote video content from Roku’s own collection of original, acquired and licensed content interspersed with recommended content from third party platforms.

Roku Recommends would be accessible to users through a banner advertisement that is displayed to the right of streaming apps on the device’s home screen. That space is currently occupied by advertisements for third party apps, subscriptions and Roku’s own streaming service the Roku Channel.

The promotional reel was first revealed by the business website Digiday, which said Roku has started pitching potential advertisers with an opportunity to sponsor its video series. Roku has not commented on the meetings or the forthcoming feature; Digiday said it learned about the initiative from three ad agency executives.

According to those executives, Roku says it expects major streaming services to participate in Roku Recommends. Digiday specifically cited Netflix, Disney Plus and AT&T WarnerMedia’s HBO Max as streaming services that are likely to sign on to the initiative.

The ad agencies were overall pleased with Roku’s presentation, though two executives expressed concerns that Roku might try to strong-arm third party streaming services into paying for shout-outs on Roku Recommends if the initiative is successful.

Those concerns may not be without merit: While Roku initially touted itself as a platform that was open to any app willing to develop for its devices, the company has shifted its strategy in recent years toward charging some ad-supported and subscription-based streaming services for distribution through the Roku Channel Store, which is the only legitimate way users can install an app on Roku’s devices.

That strategy has caused consternation among some of Roku’s users: Early last year, the company abruptly removed apps developed by Fox Corporation days before Fox’s broadcast network was set to air the Super Bowl, which is regularly one of the most-watched television events of the year.

Fox and Roku made amends just in time for Roku users to download Fox’s free apps to stream the big game, but it was a sign of things to come: A similar dispute resulted in Roku users not being able to access HBO Max and Comcast’s Peacock months after their initial launched. Some users threatened to abandon Roku for other streaming platforms; a handful actually carried through with those plans.

There’s now a valid, lingering feeling among Roku users that their favorite app could be the next to disappear — just ask Charter’s Internet customers who have been unable to access the Spectrum TV app on Roku for months.

One streaming executive who spoke with Digiday said they were concerned that Roku would try to leverage Roku Recommends when it comes to distribution deals with certain app developers in the future, either by making them pay for a shout-out in the video series or by requiring them to sponsor videos as a condition of carriage in Roku’s Channel Store.

Still, ad industry executives are interested in what Roku has to say, especially if it means reaching more people through streaming services, which is normally a complicated experience that is being made somewhat simpler thanks to Roku. And with nearly two out of every five streaming devices in the United States running Roku’s operating system, the ad world will definitely listen to whatever Roku has to pitch next.

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