home spends about $3 per month on DVD purchases now, down from about $6 per month at the start of 2012. According to Parks Associates, the average U.S. “If I’m wrong, and somehow the content owners actually do all get disintermediated and abstracted away, there’s no room for Plex,” says Valory.Įither way, Plex probably can’t sit still. Over time, the sea of apps might become less of a problem than Plex thought it would be. Universal search is now table stakes on all the major streaming platforms, and the ability to browse across multiple streaming services is starting to emerge on devices like Apple TV, Roku, and Amazon Fire TV. “Because that was such a crucial element of it, we decided, we’ve got to go broad, and we knew it would take a couple of years to do that.”Įven the notion of a central dashboard for content is becoming more commonplace. “You shouldn’t be tied to one platform to get the content experience you want,” Valory says.
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The Plex apps for Roku, PC, iOS, and Android have all received overhauls over the last few years, and new apps have arrived for Amazon Fire TV, Android TV, Apple TV, and Chromecast. Instead, the company spent the next few years polishing its existing apps and expanding to new platforms. Still, Plex didn’t pursue its own streaming content right away. In 2014, Kleiner Perkins invested $10 million.
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At the time, anyone who used an Apple TV, Roku, or Amazon Fire TV was still staring at a sea of apps Plex wanted to make the actual content easier to reach, tapping into the same system it had built for managing people’s own media collections. Soon after, Plex started pitching its long-term strategy around Silicon Valley, telling prospective investors that the world needed a central hub for media. (Although Plex is based in Los Gatos, the company has a distributed workforce.) Plex also started to sell a $5 iPhone app, and used the money to hire developers from its community. The company raised $1 million from several angel backers including LG, which put a Plex app on its smart TVs and Blu-ray players.
They pooled their efforts to launch the Mac app, and created Plex about a year later, splitting off from XMBC to focus on building up their media server software.Īlthough Plex’s founders kept their day jobs, the product gained traction over the next couple years, and in 2010 it became a real business. Through the XBMC forums, Olechowski and Ullman found Feingold, a programmer who’d been working toward the same goal in his spare time. They set out to create an OS X version for Apple’s Mac Mini, which could play HD video and came with a TV-friendly infrared remote. “And my wife looked at me like, ‘Dude, this is not the answer.'”Įventually, Olechowski and Ullman–who’d been CEO of PostX–discovered XBMC, an open-source program for hacked Xbox consoles that played a wide variety of media files. “I had this rack-mountable server behind my TV, hooked up into a VGA to component video input, and a keyboard hooked up,” Olechowski says. While the company has a knack for software, it has little experience working with content owners, and risks being outmuscled by larger companies like Apple, Roku, Amazon, and Netflix, all of whom are also trying to become the starting point for media consumption. Whether Plex has that luxury is another matter. “But we realize it’s a huge undertaking, and it’s going to take time.” “All of the stuff we’re talking about is five to seven years’ worth of work, and if we do a great job, we’ll build a big, massive company out of it,” says Valory. The hope, says CEO Keith Valory, is to provide users with a “central dashboard” for all their content, powered by unbiased search and recommendations. Podcasts, children’s programming, virtual reality, and even deep links into other popular streaming apps could be next, as Plex tries to move away from the bring-your-own content business. For the first time, the company dipped into the $10 million in venture funding that it raised in 2014 and acquired WatchUp, a startup that turns online news clips into personalized newscasts.
So in late January, Plex made a big bet on its future. DVD sales and media downloads are on the decline, and even piracy has been weakened by legal streaming options. But in the age of Netflix, Hulu, and Spotify, Plex’s business isn’t future-proof.
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