R.I.P. Boxee: 3 lessons to learn from Boxee’s demise

Nathan Betzen is XBMC project and community manager. The post below originally appeared on XBMC.us.

It appears that Boxee was recently acquired by Samsung, after its attempt to get another round of venture funding went poorly. This is fairly significant news in the XBMC world, even if Boxee was no longer running a variant of XBMC by the end. [Note: XBMC is the open-source software that Boxee’s media platform was originally based on.]  There is certainly no denying that Boxee has led an interesting life since roughly 2008. (If you don’t know the history, there are much better resources out there than I can provide.)

The short story is, Boxee started out as the little media center company that could, spun out a fork of XBMC that was well ahead of its time, and then dropped support for that software. The company followed this up by spinning out another fork designed specifically to run on a specialized box called the Boxee Box, and then they dropped support for the Boxee Box. Finally, it spun out an entirely new closed source box that had no basis in XBMC at all — and had such a miserable showing that they reportedly couldn’t get another round of venture funding. And now, finally, Boxee has found itself bought out by Samsung.

For a long time, many of us at XBMC were big fans of Boxee. The company led the good fight against content providers on behalf of consumers. Boxee spoke before congress in favor of unencrypted signals and consumers everywhere. It pushed XBMC semi-mainstream.

Boxee did many things right. But as time went on, it started doing more and more things wrong. For the sake of the future and XBMC, let’s look into a few of the mistakes of Boxee, so that we — and other XBMC businesses — can hopefully avoid them in the future.

1) Product support – feature iteration

Without a doubt, the biggest mistake Boxee ever made was failing to maintain support for old products.

For all that we may love to hate Microsoft, support for old products is one of the smartest, most important things they’ve ever done. Windows XP came out in 2001. It was succeeded by Windows Vista in 2007. But support for XP continues to this day, with an anticipated ending date sometime in 2014.

That’s a 13 year cycle of support for a product they only sold for roughly 6 years.That is the very definition of long term support.

To be perfectly honest, a 13 year cycle of support would have been complete overkill for a service like Boxee, as that level of support is really more intended for the business segments of commerce. But it wouldn’t have hurt to at least try to follow the basic tenants of support that Microsoft displayed. Namely:

1. Release a product.
2. Stop selling the product.
3. Gradually pull back support
4. Fully stop supporting the product when it becomes clear that the majority of users have moved on.

Apple is another company that does an excellent job following and even helping along this basic process with its line of iOS products.

First, they release a product with all the latest features, like the iPhone 4. Then they release the next iteration, the iPhone 4S, with a software update that mostly applies to the 4, but is missing some critical components for the absolute best experience. Then they release the next version, and still more components are missing. Finally, they release yet more version. The iPhone 4 will still be supported by this most recent version, but so many new, amazing features will only be supported on the newer hardware iterations that most users will sadly accept that it’s time to upgrade.

Boxee’s mistake was failing to follow through on basic product iteration. The step from the Boxee software to the Boxee hardware should not have been the only step. Instead, the Boxee Box should have had compelling features that simply could not have been available on the software platform.

For example, the software version might have been restricted to viewing Netflix in a browser, while the hardware version could have had an official, native Netflix app, which would have been totally possible, given the Intel chip being used.

The next generation of the Boxee Box could have had a tv tuner built in. The previous Boxee Box could have the TV tuner, but only via USB. The Boxee software would have had no TV tuner support at all.

At the end of the day, Boxee’s job was to make money, so expecting endless support for something that didn’t generate value (the Boxee software) was a losing proposition. But failing to incentivize users to see the value in gradually upgrading to the hardware versions was just as much a losing proposition.

In the tech community, hardware and software sales absolutely depend on goodwill and word of mouth. The iPhone didn’t become the best selling smartphone ever because it was a great product. It became the best selling smartphone ever because it was the COOLEST product on the block. By sacrificing the Boxee software, Boxee sacrificed all the goodwill that came with it.

And then, absurdly, they did it all again with the Boxee Box.

2) Customer service

Customer service is a very, very difficult thing for a startup company, and that’s doubly true for a startup that’s dealing with something as complex as hardware or a complete OS. Apple makes a few billion dollars a year. It can afford to hire great customer service techs all over the nation, staff a native English-speaking telephone hotline, and otherwise give customers a near infinite supply of options for tech support.

Startups, on the other hand, are often operating in the red. The majority of their money comes from venture capital funding rounds. Since they simply cannot provide one-on-one support for all the problems that might exist out there, they have to operate more efficiently than their much larger competitors.

This means they have to provide forums and other online hotspots where users can help each other. They have to provide a place that quickly and easily answers tons of frequently asked questions. Of course, they have to provide software that’s MUCH more idiot-proof than the stuff that comes from the big guys. And finally, they have to look like they are listening to the problems/complaints/concerns of their customers, who typically understand that startups often run under limited resources.

As an XBMC guy, I’m loath to ever say anything nice about Roku, but you’ve got to give them credit for a few things. First, by all accounts their software is dead simple. Second, they have a really great support page. And finally, with each new hardware iteration, they respond to the users (in particular, putting a headphones jack in the remote control was an absolute moment of brilliance).

Boxee made the simple software. And they had a pretty decent support page.

Where they failed was in giving the appearance of listening to their users. Support tickets would be closed for no apparent reason. Major complaints would go unaddressed for months. Worst of all, major complaints would go unaddressed for months, and then the carpet would be pulled out from under the feet of users as the software with the problem would suddenly no longer be supported at all.

Smart support people and community managers can do an awful lot to help the image of a software company. The recent Xbox One boondoggle could have been remessaged as “We want to be Steam for consoles with awesome winter and summer sales, but to do so, we have to lock games to accounts, so you can redownload your game at your friends house, if you just sign into their Xbox! No disc needed!” The fact that this didn’t happen says a lot about a failure in shaping the message before the “bad” part of the news got out.

Then again, console users are pretty in love with the disks they own these days, so who can say if even a perfectly shaped message could have gotten through. As the old saying goes, you can only put so much lipstick on a pig.

It’s possible the non-iterative nature of Boxee’s development philosophy was always going to screw it, no matter how well they tried to dress it up. The pig was just too ugly from the get-go.

3) Abandoning the die-hards

This one is short and sweet. Every organization has its base: the people who love the product no matter how ugly it is. In gaming, they’re called fanboys. In conservative politics, they’re called… well, we probably don’t need to go there.

The one thing you never do is abandon your base. You may try to push your base in a direction. You may try to grow a larger base that’s somewhat different than the old base. But you never abandon your base, because in doing so you automatically lose the majority of your current sales/votes/etc.

Boxee abandoned their base twice.

Frankly, it’s a miracle they still exist today, just on that fact alone.

One of the things I do as the community manager of XBMC is compare XBMC’s growth in the social networks against various competitors. I think of it as a little litmus test to see how we’re doing.

For the most part, I don’t pay a lot of attention to Twitter followers, since those can be pretty easily manipulated. Instead, the most informative number in my opinion is Facebook fans.

On August 12, 2011, Boxee had 20,000 facebook fans. XBMC had 14,800 fans. Indications were that Boxee was doing quite well.

And then, over the next five months, Boxee did not update its software, and users were becoming increasingly frustrated both by the lack of any update and by the lack of communication concerning the reason for the delay.

On December 26th, 2011, Boxee dropped its first bomb. They announced that there would only be one update of the HTPC software released, and then all support for the original, software version of Boxee would be suspended indefinitely.

On October 16th, 2012, less than a year later, Boxee officially burned another bridge, discontinuing support for the Boxee Box.

In less than 2 years since Boxee dropped support for their HTPC software base AND THEN they dropped support for their hardware base! So what happened to their users?

Let’s check the fan count after so many burnt bridges:

August 2011

• Boxee: 20,000
• XBMC: 14,800

June 2013 (today)

• Boxee: 28,082
• XBMC: 43,576

Boxee pulled the rug out from under their base twice, and still managed to pick up 8k fans. XBMC maintained a steady pace of iterative, transparent development and managed to roughly triple its Facebook fan base over the same period.

Conclusion

Boxee was, at one time, an organization ahead of its time. All indications were that it had the opportunity to really change the world for the better. In the end, it seems that the only thing that ever really held it back was its own very, VERY poorly managed development decisions.

My major hope is that people don’t look at the mismanagement of Boxee and make the unproven conclusion that media center startups based on XBMC are a dead end. I firmly believe a company that intelligently pursues the path that Boxee followed can make absolute buckets of money and at the same time can make a legion of cordcutters and cord-nevers very happy.

Photo by Tom Cheredar

Nathan Betzen is XBMC project manager and community manager. You can find him on Twitter via @natedrives, @XBMC, as well as XBMC.us and Google+.