> I don't think they were counting on how rapidly Internet streaming would take over
Ironically, those set top makers were in a perfect position to take advantage of it. They could have been Roku - they already had huge market penetration.
Sure, but those set top box manufacturers were beholden to the cable ISPs for their revenue, cable ISPs which would have been furious if a supplier started competing with them. The STB companies also, as a general rule, were really bad at UX -- there's a reason why the interface on those things was universally bad, and it's that the cable companies were the customer of the STB maker, not the end consumer. SA and the rest of them just didn't have consumer UX expertise as a real competency and didn't need to have it.
Ironically, those set top makers were in a perfect position to take advantage of it. They could have been Roku - they already had huge market penetration.