Connected TV market is ripe for an independent OS, Foxxum CEO says

The connected TV (CTV) market is flush with big, well-known names. On the TV side, there are the likes of Samsung and LG Electronics, which have developed their own operating systems and streaming platforms. Meanwhile, Google (Android TV and Google TV), Amazon (Fire TV) and Roku have all become major players in the CTV sector as well.

As those players jockey for position and domination in the hotly contested CTV market, a lesser-known company, Foxxum, is already well positioned with operating systems and app development. And though Foxxum's success has largely been achieved in Europe, the company is preparing to make a splash on both sides of the pond with a new operating system for connected TVs based on the Reference Design Kit (RDK).

Figure 2: The connected TV operating system "is simply too fragmented," says Foxxum CEO and co-founder Ronny Lutzi.
(Source: Foxxum)

Managed by a joint venture of Comcast, Charter Communications and Liberty Global, RDK is a pre-integrated, open source software stack for set-tops, broadband gateways and a few IoT devices.

Foxxum intends to broaden RDK's picture to include connected TVs for retail sale as well as operator distribution, according to CEO and co-founder Ronny Lutzi.

Foxxum has concentrated on developing apps and providing white-label app stores for its stable of partners, which includes TV makers and brands such as Sharp, Hisense, Vestel, Samsung, LG Electronics, Panasonic, Sony and Philips.

Lutzi estimates that Foxxum, a Germany-based company founded in 2011, currently has an installed base of 25 million to 30 million devices. Foxxum also operates rlaxx TV, an ad-supported streaming service that, similar to Roku's The Roku Channel, enables Foxxum to monetize viewing on its platform.

Focused on a fragmented CTV market

Lutzi believes the CTV OS market "is simply too fragmented," citing, for example, Roku's evolving focus on Europe, a move that will put added pressure on app developers there that are already supporting several other operating systems/platforms for connected TVs.

He said the complexity caused by market fragmentation can impact something as mundane as how a "back" button operates from one platform to another, requiring developers to maintain and tweak a multitude of versions.

But he said it's precisely that scenario that has led Foxxum to pursue a full OS for CTVs to ensure that everything always works the same way. And Lutzi likewise believes that the RDK gives Foxxum access to a "great" set of APIs (application programming interfaces) that provides a path to the SoC (systems-on-a-chip) layer.

"That makes it possible to always have the exact same settings," and have the ability to support the streaming market's most popular apps, Lutzi explained. "You cannot sell a TV if you are missing relevant apps. That's why we decided that we need to take control of the whole thing ... Every customer's device needs to work exactly the same way."

On a broad level, Foxxum will use its new OS to drive business in the retail CTV market and offer support to service providers/operators that are eager to jump into the smart TV market. Lutzi also views Foxxum OS 4 as a springboard into the US market.

Budding operator TV market

The operator TV market is nascent but does have momentum. Comcast and its Sky unit play in that market (with XClass TV in the US and Sky Glass in Europe). A new national streaming JV formed by Comcast and Charter Communications also has CTV ambitions.

Prior to being acquired by Xperi/TiVo last month, Vewd was developing an operator TV strategy. Xperi plans to explore the operator TV angle even as it pursues a broader plan to bring its own "independent" option to the CTV market, with an initial focus on Europe.

Like Xperi, Foxxum is independent in that it is not owned by a media giant or TV maker, and will put partners in position to get into the CTV market with self-branded products.

"From a branding point of view, we are certainly not such a threat as Amazon Fire [TV], Roku or Android TV when it comes to customers on brand dilution," Lutzi said.

He also believes Foxxum's independent footing will give it a leg up with operators seeking a role in the CTV market without tying themselves to a media giant or a hardware manufacturer that also develops and markets its own operating systems. That list includes TV makers such as Samsung and LG Electronics, as well as Google, Amazon, Roku and Comcast.

"We are simply independent, and therefore we are also no threat to an operator. We are not a CTV threat. I think that's one of our main assets," Lutzi said.

He acknowledges that Xperi/TiVo will compete with Foxxum in the market of independent CTV operating system suppliers. But Lutzi feels his company has an advantage as it looks to parlay its presence in Europe into a growth strategy focused on the US. He contends that it's an easier leap because Foxxum can bring a product to the US by supporting the top streaming services there rather than having to replicate that feat in dozens of European countries – something that Foxxum already has experience with and something that Xperi/TiVo will need to contend with as it pursues an initial CTV OS play outside of North America.

"Outside the US, TiVo has quite a marathon to run to be successful," Lutzi reckons. "But they're certainly our competitor in that field."

Update: It could also be argued that Roku is also an independent OS player since it is not owned by a media giant or device maker. However, there are rumors that Roku has plans to build its own TVs.

Alternative to Android TV

That piece of the market aside, Lutzi hopes Foxxum OS 4 will provide the operator market with a solid alternative to Android TV.

RDK has largely been focused on video set-tops, broadband gateways and a limited set of IoT devices. Foxxum's new OS will help RDK "dive into the CTV market" while also providing an additional app store alternative. Metrological, acquired by Comcast in 2019, has been a primary key app store player in the RDK world using the Lightning open-source framework.

"Everything we do is HTML-5 based. You can find millions of developers who are able to do a CTV app built on HTML-5," Lutzi said.

The RDK market, he contends, was in search of a partner that could extend the technology into the CTV market, and he believes Foxxum OS 4 can fit the bill. He also believe that other operators are interested in replicating what Comcast and Sky are doing with smart TVs.

He argues that an operator is in a stronger position when it's supporting the full CTV ecosystem, and not just a set-top box that supplies traditional content alongside Internet-delivered fare. An integrated smart TV approach effectively gives the operator more control of the platform.

Roadshows and launch plans

As for market timing, Lutzi said the company plans to showcase Foxxum OS 4 next month at the IBC show in Amsterdam, and announce some early customers for the new operating system. Just today (August 23), Foxxum announced Amlogic as a launch partner for Foxxum OS 4. China-based Amlogic is the first SoC provider powering the new operating system, Foxxum said.

The company will then go on a two-month roadshow in Europe, Africa, Australia, New Zealand and South America. From there, the plan is to follow with a full market launch in the first quarter of 2023.

Foxxum will initially focus on its base of existing customers, recognizing that the market still brims with TVs in need of an OS. But there appears to be interest outside that group. Lutzi notes that he fielded three calls from operators soon after Foxxum made the RDK announcement.

"We've had very promising discussions with customers in CTV retail, but also operators that have not worked with us before," Lutzi said.

Privately held Foxxum is co-owned by Lutzi and Dirk Wittenborg and currently employs 65 people. Following internal investments toward the development of Foxxum OS 4 and rlaxx TV, Foxxum is currently reaching out to strategic investors from the US, according to Lutzi.

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— Jeff Baumgartner, Senior Editor, Light Reading