Google has unveiled a new Internet-streaming device -- Chromecast -- that has some wondering how it will rival already established players like Apple TV and Roku.
The new Google Chromecast SDK is displayed during a Google special event at Dogpatch Studios on July 24, 2013 in San Francisco, California. Google announced a new Nexus 7 tablet made by Asus and the Chromecast SDK. (Photo: Justin Sullivan/Getty Images)
In a way, that question is already being answered in terms of early sales, as the Los Angeles Times reported, the device sold out from Amazon.com and Best Buy's website in less than 24 hours. It is still currently available in the Google Play store, but customers now have to wait a few weeks for it to arrive as opposed to only a couple days like early purchasers on Wednesday.
The gadget is part of the company's attempt to make it easier for people to access Internet content on their TVs. Chromecast is a small stick roughly the same size as a thumb drive that can be plugged into an HDMI port on flat-panel TVs. It brings Netflix, Google's YouTube site and other Internet content to what is usually the biggest screen in households.
Forrester Research analyst Sarah Rotman Epps said Chromecast could undermine Apple in the still-nascent market to plug streaming devices into TVs, just as the Nexus tablets have siphoned some sales away from Apple's iPad.
Mario Queiroz, Vice President of Product Management at Google, holds up a new Google Chromecast SDK as he speaks during a special event at Dogpatch Studios on July 24, 2013 in San Francisco, California. Google announced a new Asus Nexus 7 tablet and Chromecast SDK. (Photo: Justin Sullivan/Getty Images)
In a show of its determination to make inroads on TVs, Google started selling Chromecast for just $35. That price undercuts the most popular Internet-streaming devices made by Apple and Roku. An Apple TV box sells for $99, while the least expensive Roku box capable of showing high-definition video goes for $80. Roku, a company that formed within Internet video subscription service Netflix Inc., also sells an Internet streaming stick similar to Chromecast for $100.
Google is also enticing people to try out Chromecast by offering three months of free Netflix service with a purchase. That translates to a $24 value, leaving the cost of the device at $11 for those who would have gotten Netflix anyway.
Why the cheap price? The Washington Post reported James McQuivey with Forrester saying it's not about making money on a device, but about the software:
This new strategy doesn’t even focus so much on selling the content, he noted. It’s aimed more at gathering information on consumer habits — data that Google could combine with search and other data from its services to expand its user profiles.
“This is a deep, deep relationship built with you,” he said. “It opens potential for them to do much more for you than they could before.”
Earlier this year, Apple revealed that it has sold more than 13 million of its streaming boxes. Roku said its sales of streaming boxes surpassed 5 million units this year.
The Chromecast device connects with smartphones, tablets and personal computers to beam Internet connections to TVs. The Apple and Roku streaming boxes rely on a standard remote control to select Internet content.
Also unlike these two devices that allow content to be played from smartphones or tablets, the Washington Post pointed out that Chromecast not only allows content to be beamed to a TV, but it still allows the mobile device to be used for other functions at the same time.
Check out Google's promotional video for Chromecast to see how it works:
Google's previous products designed to connect TV sets to the Internet haven't worked out well. The company initially tried to embed an operating system called Google TV into sets made by TV manufacturers, but that flopped. Last year, Google introduced an orb-like device called the Nexus Q in hopes of delivering more Internet video to flat-panel TVs, only to quickly pull the product from the market.
"Chromecast looks like a smart and disruptive device," Rotman Epps said. "Maybe it took the other failures for Google to get it right."
The Associated Press contributed to this report.