A self-made tragedy was narrowly averted when many Roku customers were able to tune into the Super Bowl on Fox apps Sunday. The threat that the Super Bowl would be unavailable on Roku Fox apps flared up Friday when Roku began to issue announcements concerning its revenue sharing disagreements with FOX.
Despite what some might think, nothing this week had anything to do with politics. It was money. We don’t know what the financial details behind the disagreement were but the reason FOX almost lost apps on Roku was because the two sides couldn’t come up with an agreement for revenue distribution.
Don’t think for a second that this is the last time you will ever see this happen. Also don’t think for a second that Roku is the only company you will ever see this happened with. These streaming companies, as I have said a number of times, are becoming a new middleman for distributors and consumers. Just like the cable company has to negotiate with FOX and CBS and Viacom and other rights holders to put their content out and make money on it so do Roku, Amazon, Apple and others. But there is something about this situation that must be called out.
Bad Or Perfect Timing
This issue with Fox with just a very noisy contract dispute that blew up at just the wrong time (or just the right time). We don’t know exactly how this got worked out (who caved), but I’m sure both sides realized it would be really bad had it not. Even though the apps in question are TV Everywhere apps, meaning any pay-TV customers who are supposed to be able to access the services in the first place would be able to watch it on their own TVs regardless, I’m sure there are some legitimate paying Fox customers who were not home and also have a Roku who wanted to use them this weekend to watch the Super Bowl.
FOX and Roku Need Each Other
FOX wants to be on Roku because Roku is the largest streaming platform in the US and Roku wants Fox to participate because it’s the home of NFL football the number one rated news channel in the country and plenty of other things. Roku wants to maintain its open image and be able to provide as many apps as possible. Roku made a big mistake in the first place though by allowing themselves to be put over a barrel on the weekend of the Super Bowl. When it set up its deal with FOX it should have anticipated something like that. Hopefully its deals with NBC don’t run out right before the Olympics or it will be the same thing all over again.
But like I said earlier, this is not a Roku issue. It is going to be the new normal. Amazon has contracts, so does Apple, so does LG etc. Remember the “Amazon won’t have Disney+”story line? That was a money issue nothing less. And it worked out for the same reason. Amazon was not going to let itself be the only major platform without what was the most antipated new app ever. There are multiple networks and powerful media companies with apps on these streaming platforms. And depending on how many apps one service provider has the effects will be widespread or unnoticeable. But it would be totally possible for people to lose Turner’s apps on any of the streaming platforms if a disagreement were to arise regarding revenue sharing.
The reason this is going to become a more and more important issue is because the audience for all of these things is growing. It’s why Netflix is getting more expensive. When streaming was new it used to be able to negotiate to get lots of content for a much lower rate than it does now. Netflix didn’t really want to drop all the movies that it did. Netflix doesn’t really want to lose the Office and other shows that it does occasionally. But the rights holders have been noticing that millions of people are watching the content. So now so they want more money or want to monetize it themselves or get a kings ransom from Netflix to keep it.
While there have been some notable examples of certain personalities who have found themselves unable to keep a presense on social media and streaming platforms none of the major platforms wants to get into social issues if it can do anything to help it. The vast majority of the time it is a disagreement/negotiation over percentages for advertising or subscriptions.
