AT&T's (NYSE:T) "skinny bundle" live TV streaming service has had a bit of a rough time in recent years. Back in 2018, the service then known as DirecTV Now lost its reputation as the rising star in the live multichannel streaming space, and it did so in pretty dramatic fashion: After a strong run of rapid subscriber growth, the service suddenly and unexpectedly lost subscribers in the fourth quarter of 2018. It lost subscribers again in the first quarter of 2019, and again in the second quarter of 2019. AT&T blamed lapsing promotional subscriptions for the sudden crash, an explanation that turned out to be both true and incomplete: AT&T did indeed lose a lot of promo subscriptions, but part of the problem was that such subscriptions were -- allegedly, at least -- created fraudulently in the first place and assigned to unknowing customers.
DirecTV Now rebranded not long afterward. But the trouble wasn't over for the newly christened AT&T TV Now, which kept losing subscribers. And the users who were left soon found that the AT&T TV Now app was no longer supported by the Roku (NASDAQ:ROKU) platform. That was a big deal because Roku's platform is the most popular in the streaming world. Now, as first reported by Cord Cutters News, AT&T TV Now is back in action on Roku. That's a big deal for AT&T's live TV platform, and it may also be a good sign for AT&T's upcoming subscription video on demand (SVOD) streaming service, HBO Max.
Why losing Roku was a big deal
Roku is a major player in the tech and streaming spaces, but not in the same way that Netflix (NASDAQ:NFLX) is. Roku maintains the most popular user-facing streaming platform on the market. Buying a Roku device (like a Roku Ultra streaming box or a Roku-branded smart TV) means gaining access to Roku's operating system and app environment, where it's easy to download apps for services like Netflix and (Disney-controlled) Hulu, select them from the menu, and start streaming. Roku makes money through its partners and via a fairly typical "platform tax," as well as through advertising (Roku has had success with its ad-supported streaming service, which is called The Roku Channel and is available on Roku's platform).
Roku is successful for a few reasons, including its early arrival (it was the first "Netflix player" on the market) and its relatively app-agnostic approach, which makes for a bit of a contrast with Alphabet's Android TV or Amazon's Fire TV platforms. Unlike Fire TV and Android TV, Roku's platform doesn't have an incentive to push a parent company's subscription streaming service or video marketplace, and it has dodged disagreements of the sort that kept Alphabet's YouTube off of Fire TV devices and Amazon's app off of Android TV ones.
What happened to the AT&T TV Now (née DirecTV Now) app was that Roku stopped "supporting" it. This didn't mean that it was deleted off of users' devices, but it did mean that it disappeared from Roku's app store and that downloaded versions could no longer be updated. Users who had installed the app before it disappeared could keep and use that version of it (again, no updates). But if a user deleted the app, it was gone for good. And if a user wanted to add the app to a second Roku device, they were out of luck.
Losing Roku support instantly made AT&T TV Now a less useful service to many customers. It also cut AT&T TV Now off from Roku users who might otherwise have stumbled upon it and signed up through their Roku devices.
Let's make a deal
It's not clear what caused the spat between Roku and AT&T TV Now, though it presumably had something to do with how much Roku would get in order to support the app and allow Roku users to sign up for the service. Whatever the issue was, it appears now to have been resolved. AT&T TV Now users can once again download the AT&T TV Now app on Roku and receive updates to that app. New customers can once again sign up for AT&T TV Now on their Roku devices.
That's a big deal for AT&T TV Now. Going MIA from the biggest platform in the streaming game was obviously not the best way to reverse the unfortunate trends of the late 2010s. Now, AT&T TV Now has one less big thing to worry about.
This is an intriguing moment for reasons that go beyond AT&T TV Now, though. AT&T also has a high-profile subscription video on demand (SVOD) service on the way: HBO Now. Slated for release on May 27, HBO Max is without a reported deal with the Roku platform as of this writing. It's possible that we'll hear about such a deal soon, though -- the change to AT&T TV Now's status might very well be a part of a larger deal, and it at least bodes well for the working relationship between AT&T and Roku in a way that the AT&T TV Now/Roku spat did not.
Landing a deal with Roku will be crucial for HBO Max for all of the same reasons that losing Roku support was such bad news for AT&T TV Now. And getting off to a strong start will be important for HBO Max, which will launch in the midst of a boom time for streaming and will join a highly competitive market that includes massively popular options like Netflix and Disney's Disney+ -- both of which are available, of course, on Roku.