Streaming Devices a Thing of the Past? Not So Fast

In-Stat released an interesting report earlier this year, questioning the long-term viability of dedicated streaming players. The report suggested that the growth of other connected devices, such as TVs and Blu-ray players, would eliminate the demand for dedicated streaming devices, and went so far as to predict that the popularity of standalone streaming players would peak this year before experiencing a rapid decline over the next five.

I’m not so sure.

Many of the connected TVs and Blu-ray players I’ve tried don’t quite seem ready for prime time. While dedicated streaming players are designed to stream video, these other devices have a different primary purpose and processing power often suffers as a result (game consoles are the obvious exception here, with more than enough power to handle streaming video).

For example, I’ve seen a lot of complaints from people who have purchased connected TVs or Blu-ray players to watch Netflix or Hulu, and end up with poor resolution or a video that keeps pausing to reload. The first instinct is to blame the service provider, but in many cases the device is really the problem. When these same people try a standalone streaming device on the same connection, the problems often vanish altogether. Even on the very slow DSL connection at my house (about 5 Mbps), I get crisp video with no interruptions on all streaming devices.

Connected devices like TVs and Blu-ray players will certainly catch up eventually, but the fact remains that consumers don’t make those big purchases very often. At this point, streaming players offer a better experience at a much (much) lower price. I think it’s likely that many people will wait a few years to see what happens before purchasing their next TV.

Another thing this study fails to address is that a lot of people still have old TVs, and they will for a while. Many people keep their old TV around when they get a new one, and many of these streaming players (especially those with component output) are an ideal companion to a “dumb” TV in the guest room or kid’s room. In an era when there’s a lot of talk about home gateways, a small inexpensive set-top still has a lot of potential.

This month Roku is releasing the LT, a scaled-down version of its popular player, with a $50 price tag. Not only is it bright purple — a cosmetic first in streaming players — I have a hunch the Roku LT will be the first in a long line of budget streaming players. The LT supports 720p video and composite video out, or, all you’d need for an older digital TV. All the same subscription services are available as on the more expensive models, and initial reviews are very positive.

I think there’s still a lot of demand for dedicated streaming devices, and I wouldn’t be at all surprised if that demand continues to grow over the next few years. HDTVs are less expensive than they were a few years back, but they’re still expensive, and they become obsolete quickly. If you just bought a fancy connected TV, chances are you may find yourself connecting it to a Roku in a few years.