Roku Inc to launch premium video channels business

Subscribers will be able to watch the content using Roku’s mobile application – a first for Roku.

Roku Inc will now offer premium video contents, alongside its free ones, to its subscribers for a fee, said the video streaming service in a statement.

This will include premium channels from Lionsgate-owned Starz, CBS Corp’s Showtime, Noggin from Viacom Inc among others to viewers of the Roku Channel – a free video service offered to owners of Roku streaming video devices.

The development, will add competition to the lucrative channels business launched by Amazon in 2015 which resold video services on a “a la carte” fashion.

Incidentally, Roku had been spun off from Netflix in 2008.

Apple Inc is expected to launch its own video streaming service and is expected to adopt a similar model, according to sources familiar with the plan.

According to a recent BMO Capital Markets report, Amazon’s Channels business has contributed a sizeable portion of revenue for participating media companies; it is expected to have generated $1.7 billion in 2018, an increase of more than 100% from the previous year.

According to media executives, the channels business is popular since it removes hurdles for consumers to subscribe to the services where they are already watching television. Just like Amazon, Roku will handle the billing for these services, allowing viewers to subscribe directly from the Roku Channel.

Further, Roku’s expanded Roku Channel will also be available to users of Roku’s mobile application for the first time.

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