After years of shipping millions of smart TVs in Europe, Asia and Latin America, VIDAA is ready to make its mark in the United States.
Early last year, VIDAA OS-powered TV sets made by Hisense began appearing on the shelves of major retailers like Best Buy, Target, Walmart and Costco, joining a crowded market of smart TVs that are vying for the wallets and attention of American streaming TV households.
If you've never heard of VIDAA, you're not alone. The VIDAA business was spun out of Hisense into a separate, independent operation in 2019, and since then, it has primarily focused on developing and shipping smart TVs in overseas markets where the streaming landscape is more fractured and the competition for households less fierce.
Early on, VIDAA capitalized on a desire by foreign TV markets to license a fully-developed smart TV operating system for their hardware. Until recently, Roku was focused primarily on the American market, and Amazon shipped its Fire TV operating system through dongles, not TV sets. Samsung and LG, the two top smart TV brands by global market share, have largely kept their TV operating systems to themselves.
VIDAA approached those vendors with an opportunity to integrate their streaming TV operating system across different types of TV hardware. Hisense provided the first proof of concept that the operating system, called VIDAA OS, could run on low-cost TV sets smoothly. Today, VIDAA TVs are sold in more than 160 countries, and run streaming apps from over 200 partners — among them, recognizable brands like Netflix, YouTube, Prime Video and Rakuten TV.
Executives now want to replicate some of that success in the United States, though they know it will be a challenge: Roku and Amazon control 80% of the domestic streaming TV market with their budget sticks, dongles and TV sets, according to Parks Associates. They also enjoy a decade-long head start on VIDAA and other competitors. But VIDAA executives believe we're in the early stages of the streaming revolution, and there is still more room for more players.
"We are just in the beginning of the era of the smart TV," Guy Edri, the CEO of VIDAA International, told StreamTV Insider in an interview from his home in Tel Aviv. "The U.S. is a very saturated market — that's why we decided to focus on other places first, and only recently in the U.S. — but our platform is like any other platform."
But VIDAA needs to set itself apart from the rest with unique value propositions, Edri acknowledged. That means marketing its platform to consumers as one that can compete with the rest, with the apps and features that they want. It also means focusing on its position as a truly-independent platform that has the interests of consumers and manufacturers in mind.
Edri said VIDAA doesn't want to go head-to-head with its manufacturing partners. Unlike Roku and Amazon, VIDAA has no plans to build its own smart TVs. And while VIDAA does have its own free, ad-supported streaming channel that is integrated into VIDAA OS, the company doesn't program its own linear content streams or license TV shows and movies from studios.
Those are deliberate strategies meant to position VIDAA OS as a truly independent operating system that anyone can license and integrate into their TVs, according to VIDAA's Senior Director of Market Development Denis Oštir.
"We are happy being just a platform," Oštir told StreamTV Insider. "We do not want to be the content provider, we do not want to be the hardware manufacturer, we do not want to be the ad tech provider. We are looking for partners in all of those areas, because we understand it is a complex ecosystem — there are many moving parts, and to try to do everything at the same time is difficult."
VIDAA's strategy is not completely altruistic — the company wants to make money. Like others in the space, VIDAA generates revenue from a mixture of licensing agreements with hardware makers and from the sale of advertising inventory within the VIDAA OS home screen. Executives feel they need a stateside presence if they really want their advertising business to take off.
"The U.S. is the market where the money is, and we definitely want to be part of that game," Oštir noted. "We are not going to go into it aggressively, we're not going to dive into it head-first...but it's a market we want to be in. Why would we not want to be there?"
Oštir said VIDAA is likely to experience less friction entering the U.S. market after developing its ad business overseas than if they took the opposite approach — the way Roku and others started in the U.S., then tried to bring their platforms overseas.
"All the ad markets outside the U.S. are completely different — we know this because we are there," Oštir said. "But, we are coming into the U.S. very prepared with our international experiences."
Some of that experience is already starting to pay off: Shortly after our conversation in January, executives announced a new partnership with global marketing platform Teads that will see the latter sell display advertising inventory against VIDAA-powered TVs in a handful of countries. Southwest Airlines is the first advertiser to take advantage of the partnership for VIDAA-powered TVs in the United States.
The lessons VIDAA learns from developing its advertising business in the United States will ultimately help the company grow its global business, Oštir said.
"We want to learn a lot in the U.S.," he affirmed.