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The Long Sad Tale of Boxee: A Look Back

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Boxee is no more. Long live Boxee!

Boxee began as an idea in 2003 and ended as a sale to Samsung in 2013, rumored at $30 million. If we see Boxee again, it will be buried so deep in a Samsung interface that we won’t recognize it.

One of the first pieces I ever wrote for Streaming Media, back in March 2009, explained this strange new thing called Boxee. This was long before Boxee hardware, when most users ran Boxee on Apple TVs or Mac minis.

Ahead of its time when it debuted, Boxee found eager adopters in hipsters and hobbyists (“alpha geeks,” as co-founder and CEO Avner Ronen called them). It offered an attractive way to stream online videos to a television and to see what friends were viewing.

Back in 2009, the company had two main problems: 1) Hulu wasn’t onboard and blocked its videos, and 2) the number of alpha geeks willing to go through the hassle of getting Boxee on their TVs wasn’t high.

Boxee hoped to remedy that second problem by introducing the Boxee Box, a set-top box created with D-Link. Boxee showed a prototype of the Box at the Consumer Electronics Show (CES) in 2010, but it didn’t reach the market until November. The device sold for $199 and made using the Boxee media interface simple. Unfortunately, Boxee was no longer ahead of the curve. By late 2010, game consoles, Blu-ray Players, and inexpensive Roku boxes gave most consumers all the streaming they really wanted (which was just access to Netflix).

The people at Boxee offered improvements to the Box (Netflix support, a $49 accessory for tuning in over-the-air channels), but they weren’t enough to increase sales. Looking a little desperate, the company cancelled the Box and announced an entirely new product, the Boxee TV, in October 2012 (alienating its fan base in the process). Boxee TV listed for $99 and looked cutting-edge by offering a cloud DVR. Unfortunately, unlimited cloud DVR support cost $15 per month (later reduced to $10).

The Boxee TV’s big problem was that cloud DVR service was only available in eight metropolitan areas. In one of my favorite pieces on StreamingMedia.com, Tim Siglin told how the device was being sold in Walmarts in rural markets, then instantly returned when people discovered the cloud DVR feature didn’t work in their area.

Now, Boxee has taken one large, final pivot and cashed out, selling its assets to Samsung. While I couldn’t get Ronen on the phone, I did talk to Jonathan Gaw, a research manager at IDC who’s been following Boxee. I asked him what about Boxee was worth $30 million.

It’s all about the media interface, Gaw said. Samsung wants to create a connected entertainment ecosystem for its TVs, something akin to iTunes on the Mac. “When people go and buy a connected TV, for the most part they are not buying the networking in the TV, they’re buying Netflix and Pandora,” Gaw said.

What Samsung wants to do, he believes, is create a rich media interface that gives people a reason to choose a Samsung set. Rather than simply providing access to other services, it will create a name-brand service of its own.

Is this going to succeed, I asked? No TV maker has pulled it off yet.

“In the scheme of Samsung, $30 million is not a lot of money,” Gaw said. “If they have a 1 in 10 chance of turning Boxee into something substantial, then it was a wise investment.”

So that’s the end of Boxee, a minor Samsung investment that may not have reimbursed all of Boxee’s investors. Good-bye, Boxee. You didn’t succeed, but you made the streaming world more interesting.

This article appears in the October/November 2013 issue of Streaming Media magazine as "The Long Sad Tale of Boxee."

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