(7+) Secret Reasons Why Roku TVs Are So Cheap (2024)
Have you ever wondered why Roku TVs are so cheap compared to other smart TVs?
The truth is, that Roku and the companies that make Roku TVs have a secret strategy that allows them to price their products competitively.
You’re probably thinking there must be a catch, right? How can a 4K smart TV with thousands of streaming channels be so affordable?
Well, the real reason Roku TVs are so cheap is how Roku makes money and how it partners with TV manufacturers.
While other smart TV platforms focus on profiting from their hardware, Roku takes a different approach.
They’ve built their business model around earning money from advertising and content deals instead of marking up the TVs.
Introduction to Roku TVs
Roku TVs offer premium features at budget prices. How do they do it?
Roku TVs are manufactured by brands like TCL, Hisense, Sharp, and others. These brands produce TVs very efficiently, keeping costs low.
They pass on the savings to you through affordable, feature-packed TVs.
Roku TVs run on the Roku OS, Roku’s streaming platform which provides access to over 500,000 movies and TV episodes.
Roku does not charge TV makers to license its OS and streaming platform. Instead, it makes money through ads and content partnerships.
This allows them to offer the platform to manufacturers at no cost, allowing those brands to sell you a smart TV at a lower price.
1. Minimal Hardware Costs Keep Prices Low
Roku TVs are incredibly affordable, but how can they offer so much for so little? Two words: minimal hardware.
Roku smart TVs ditch expensive components like built-in cable tuners and optical drives in favour of streaming capabilities, allowing them to pass the savings onto you.
Roku TVs are designed specifically for streaming, so they don’t require an antenna or coaxial input to access live TV.
Instead, they utilize streaming services to deliver content over Wi-Fi. This streamlined hardware reduces manufacturing costs significantly.
Roku TVs also lack components like DVD or Blu-ray players, keeping prices low.
Blu-ray players, gaming consoles, and other devices may be limiting. Fewer inputs also help keep costs down.
Roku TVs run Roku’s own user-friendly smart TV operating system, built to emphasize streaming apps and services.
The platform is lightweight and runs smoothly even on budget hardware.
Roku frequently updates its OS to improve performance, add new features, and patch security issues.
Because Roku TVs utilize third-party streaming services for content, they don’t require expensive licensing deals or hardware to access cable TV lineups.
Roku has partnerships with over 5,000 streaming channels, offering a wide range of free and paid options for movies, TV shows, news, sports, music, and more.
It has minimal components, an affordable yet capable operating system, and a focus on streaming over traditional live TV.
Roku TVs strip out everything unnecessary to provide a great smart TV experience at a lower cost.
If streaming is your main source of entertainment, a Roku TV could save you hundreds compared to a traditional smart TV.
For budget-friendly streaming, Roku TVs can’t be beat.
Limited inputs
Roku TVs typically offer a basic set of inputs, such as a few HDMI ports, USB, composite, etc.
They don’t provide many HDMI inputs for connecting many external devices.
The number of ports is sufficient for most streaming and casual use, but it is insufficient for those looking to connect surround sound systems.
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2. Roku OS is Built Cheaper
The Roku operating system is built specifically for streaming, keeping costs down.
Unlike other smart TVs that run general-purpose operating systems, Roku TVs run Roku OS, an OS optimized for streaming. This single-purpose design means:
Less processing power is needed
Roku OS doesn’t need as much processing power or memory to run smoothly. It’s designed to do one thing stream content.
So, it doesn’t require expensive components found in regular smart TVs. Lower-end components and less memory keep costs down significantly.
No licensing fees
Roku OS is developed in-house, so Roku doesn’t have to pay licensing fees to third parties.
Other TV makers pay to license operating systems like Android TV, webOS or Tizen.
By using their proprietary software, Roku avoids those added costs.
Basic features only
The Roku OS is focused on streaming essentials. It doesn’t include many smart features on regular smart TVs like web browsing, gaming or live TV integration.
By excluding additional functionality, Roku reduces software complexity and the need for more advanced components, keeping costs down.
Built for simplicity
Roku OS has large icons and text that make navigating on the big screen easy. But underneath is the simple design.
it’s a lightweight OS that doesn’t require much processing power or memory to run smoothly.
The simple, streamlined software and minimal hardware requirements translate into major cost savings that Roku can pass on to customers through their affordable TVs.
In summary, Roku TVs can be budget-friendly thanks to Roku’s proprietary streaming software, lower-end components, lack of licensing fees, ad revenue model and focus on essential functionality.
These factors allow Roku to cut costs at every turn and offer smart TVs at prices that are hard to beat.
3. Advertising Brings in Steady Revenue for Roku
Roku makes the majority of its money through advertising on its streaming platform.
As more people use Roku to stream content, Roku’s advertising space becomes more valuable for companies wanting to promote their services or products.
Targeted Ads
Roku has access to data about what you watch to serve up targeted ads based on your viewing habits and interests.
You’ll probably see ads for home improvement stores or real estate companies if you frequently watch home renovation shows.
The ads may promote a local business in your area based on your location.
Roku’s ability to target ads to specific audiences allows it to charge advertisers higher rates.
Companies will pay more for ads tailored to potential customers likely interested in their product or service.
Roku makes money through revenue-sharing agreements with advertisers based on the number of ads shown and viewer engagement.
Ad-Supported Content
In addition to ads that run during streaming content, Roku also offers ad-supported live TV channels and on-demand options.
The Roku Channel features live news, sports, movies, and TV shows with commercial breaks.
Roku gets paid to place ads on these ad-supported streaming channels.
The more people who use these free streaming options, the more ad revenue Roku generates.
Data Collection
Some privacy advocates argue that Roku collects too much data about users and their viewing habits to serve targeted ads.
However, Roku claims they do not share personal information with advertisers, and users can adjust privacy settings to limit ad personalization and data collection.
Despite privacy concerns, Roku’s ad-based business model has proven very profitable and allowed it to offer affordable streaming devices and content.
Roku’s steady advertising income, especially from targeted ads and ad-supported streaming content, allows them to keep device and subscription costs low for customers.
While advertising may annoy some, it makes Roku’s cheap streaming possible.
Without ads, Roku products would likely cost significantly more.
4. User Data Allows Targeted
Roku cleverly makes money from its streaming media players and Roku TVs.
One of the biggest is through targeted advertising.
While the hardware is very affordable, Roku collects data about what you watch to serve tailored ads.
User Data Allows Targeted Valuable Ads
When you set up your Roku device, you are asked to provide personal information such as your age, location, and interests.
Roku then tracks your content: the shows, movies, channels, etc.
This viewing data, combined with the info you provided upfront, allows Roku to gain useful insights into you as a user.
They can then sell highly targeted ads matching your preferences and viewing habits.
Advertisers will pay a premium for these targeted ads, especially around popular shows and events.
Roku makes money by selling ad space and user data. They split the revenue with content providers and channel partners.
The more you use your Roku, the more data they collect about your tastes and the more valuable their ads become.
It’s a win you get an affordable streaming device and content, and Roku and its partners earn money from advertising.
While some may find the data collection concerning, Roku allows you to opt out of personalized ads.
You can also limit ad tracking and turn off viewing data collection in your Roku account settings.
Roku isn’t the only one that capitalizes on user data for advertising.
Smart TVs from Samsung, LG, Vizio and others employ similar strategies.
Streaming services like Hulu and YouTube also use your info to serve up targeted ads.
Data collection and privacy are ongoing issues in streaming media and smart device space that will likely not be resolved anytime soon.
For many, the trade-off of sharing some viewing info in exchange for lower-cost hardware and content is reasonable.
However, if data privacy is a top concern, you may want to consider other options.
Roku does aim to be transparent about how it collects and shares your data, but ultimately, you have to decide what level of tracking you’re comfortable with.
5. Licensing Fees From Content Partners
Roku makes money from its streaming devices in a few clever ways.
One of the biggest is through licensing fees from the many content providers on their platform.
Streaming Content Deals
Roku has deals with almost all the major streaming services: Netflix, Hulu, Sling TV, YouTube TV, and more.
For the privilege of being featured on Roku’s platform and having millions of potential new subscribers discover them, these companies pay Roku a licensing fee.
The specifics of these deals aren’t public, but you can bet that the more popular a service is, especially if it’s highlighted prominently on the home screen, the more they’re paying.
Roku likely charges higher fees for premium placement, like being featured on the home screen or having a dedicated channel button on the remote.
They may also take a small cut of subscription fees generated from their platform.
These types of partnership deals are hugely profitable for Roku.
As the streaming landscape has exploded, content providers are eager to get in front of Roku’s audience, which gives Roku a lot of leverage to negotiate good deals.
And with over 50 million active accounts, the potential audience is massive.
These deals mean you, as a user, have access to a wide range of great streaming options in one place.
You don’t have to switch between separate devices for different services.
Roku aggregates everything together on its easy-to-use platform.
The downside is that Roku’s interface sometimes feels cluttered, with many channels and options vying for your attention.
But overall, their vast content selection, simple navigation, and affordability are why Roku TVs have become so popular.
By bringing in licensing fees from content partners, Roku has found a way to keep costs low while still turning a profit.
6. Poor Speakers Quality
The Roku TV speakers are not of that good quality. The sound of their speakers is basic.
You can connect other speakers with Roku TV if you want to enjoy good speakers.
By connecting to another speaker, you can enjoy good sound.
7. The Roku Channel and Original Content
The Roku Channel, Roku’s streaming channel, offers thousands of free movies, TV shows, and more.
It adds value for Roku owners and is a big reason why Roku TVs and streaming devices can be so affordable.
A huge library of free content
The Roku Channel gives you access to a massive collection of free content, including movies, TV shows, live news, kid’s shows, and viral videos.
We’re talking thousands of choices from major studios like Lionsgate, Metro-Goldwyn-Mayer (MGM), and Sony Pictures.
You’ll find everything from classic hits to recent blockbusters.
Not only does Roku invest in licensing all this content for its channel, but it also invests heavily in creating its own original shows and movies exclusively for The Roku Channel.
Some of their popular original series include ‘Most Dangerous Game’ starring Liam Hemsworth, ‘Cipher’ an original sci-fi film, and a reboot of the classic kids show ‘The Magic School Bus.’
It’s Free, But There are Ads
While The Roku Channel is free to access, the content is ad-supported.
Like regular broadcast TV, you’ll see commercials while watching shows and movies.
The ads are how Roku can keep The Roku Channel free and invest in more content.
If ads bother you, you can pay $9.99/month for an ad-free subscription to The Roku Channel.
Roku TVs Pros:
Pros | Description |
---|---|
1. Extensive Content Library | Access to a wide range of streaming channels and apps. |
2. User-Friendly Interface | Intuitive interface for easy navigation and setup. |
3. Affordable Options | Various price points to fit different budgets. |
4. Cross-Platform Search | Universal search function simplifies content discovery. |
5. Regular Updates | Software updates to improve performance and features. |
Roku TVs Cons:
Cons | Description |
---|---|
1. Limited Gaming Capabilities | Not as powerful for gaming as dedicated game consoles. |
2. No Native iTunes Support | iTunes content may require casting from another device. |
3. Voice Remote Limitations | Voice recognition may not always be accurate. |
4. Some Apps May Be Missing | Not all streaming services may be available on Roku. |
5. Less Customization | Less flexible in terms of interface customization. |
Roku TV Buying Guide
So you’ve decided to buy a Roku TV but are unsure which one is right for you. There are a few things to consider to find your perfect match.
Size
Roku TVs come in a range of sizes to suit any space. A 32-—to 43-inch TV should work great for a small room like a bedroom or office. For larger living rooms, you’ll want a 50-inch or bigger.
Remember that 4K resolution is best viewed on TVs 55 inches and up. Think about how far you sit from the TV and choose a size that will give you an immersive experience without being too big.
Resolution
Most new Roku TVs are 4K, meaning they have four times the resolution of regular HD. 4K provides a lifelike, vivid picture with intense detail.
If you do a lot of gaming or watch action/adventure movies, 4K is highly recommended.
For casual viewing or if you’re on a budget, a 1080p full HD model will still look good.
Smart features
All Roku TVs provide access to the Roku Channel Store, which offers over 500,000 movies and TV episodes, as well as live news and sports.
The Roku OS is user-friendly, with an easy on-screen menu to explore channels and streaming services.
Some higher-end Roku TVs offer voice control through the Roku mobile app and voice remotes to search for content quickly.
Certain models also have built-in Bluetooth for private listening on wireless headphones.
Roku TVs offer great value for the money, with their intuitive smart platform and access to a wide range of free and paid streaming content.
Use this guide to determine the right size, resolution, features, and price. Happy streaming!
Conclusion
So there you have it. Why do Roku TVs seem almost too good to be true?
Roku delivers a streaming experience that punches well above its weight class by focusing on software over hardware and keeping costs down.
You get a vast selection of content, an intuitive interface, and performance that satisfies without emptying your wallet.
While other smart TV platforms try to wow you with needless features.
Roku keeps it simple and helps you discover great entertainment at a price that can’t be beaten.
Next time you’re in the market for an affordable smart TV, don’t overlook Roku your wallet will thank you.
FAQs;
What differentiates Roku TVs from smart TVs? The main distinction between a Roku TV and a smart TV is that a Roku TV uses technology developed by the Roku streaming media player company.
Roku can be used without an internet connection, but there are some restrictions on the content you can watch. To stream content, a live internet connection is necessary for some websites, including Netflix, Hulu, and YouTube.
Any Roku player can be linked to a 4K UHD or HDR-capable display because all Roku streaming devices are compatible with any television with an HDMI port. However, you will need a compatible Roku streaming player and a television that supports 4K UHD or HDR to stream movies and TV shows in these formats.
Netflix is free to download, but you must have a Netflix subscription to stream content.