Roku unveiled its latest streaming box today, the Roku 3, and although it looks similar to its predecessors, it packs some significant internal upgrades. Roku has always valued function over form, and their latest device shows that there’s been no departure in that mentality. Aesthetically speaking, it’s still just a small box, three and one half inches long and wide, and only an inch tall. Weighing in at 5 ounces, it really is an unassuming device. The newly rounded sides are a nice touch, and visually, it’s the only noticeable difference between it and the Roku 2.

The Roku 3 hardware has received a few important upgrades. The processor that powers the device is much more powerful than those used in previous models. Users should experience less lag when moving around the menus. This new processor is thought to be capable of supporting a YouTube app, although no such app has been announced. YouTube was specifically left out on previous models, because Roku felt that the processors used at the time would have resulted in a negative user experience. That limitation no longer exists.

One of the more innovative upgrades can be found on the Roku 3’s remote control. Viewers who value their privacy can use the Roku supplied earbuds, or their own headphones, to plug in to the remote control’s headphone jack. During these private listening sessions, the Roku 3 streams the audio to the remote, rather than to the TV.

The Roku 3 offers several software upgrades. The user interface has been modified, switching from a linear menu to the new menu grid. Users can now more easily scroll through the icons of streaming channels. Roku went even further to enhance the user experience by building universal search into the operating system.

SiliconANGLE contributing editor John Casaretto described it as one stop search functionality. Detailing how it works, he said, “It can take searches, and search all the different services, and all the different channels that are on it. It orders the search by services that you subscribe to, and those that you don’t. It can order it by price, and it even has a tag that says if the movie you’re looking for is HD or not.”

Previously, if a user wanted to watch Back To The Future, separate searches would have had to be conducted in each app in order to find it. With universal search, Roku shows the search results for every streaming channel at once. It’s a feature that will save much time, and relieve much frustration. In an effort not to alienate existing users, earlier Roku models will be able to upgrade to the new OS in April.

With the Roku 3, Roku is ensuring that among set top streaming devices, it remains the premium option. While many see a potential competitor in Apple TV, they have yet to show us anything worthwhile, comparatively speaking. Priced at just $99.99, there’s no better option than the Roku 3 for consumers who want a dedicated streaming device.

But does it make sense to buy a dedicated streaming device? Consider this alternative. For only $199, consumers can buy a super charged streaming device known as the Xbox 360. It streams all the channels that Roku 3 offers, plus an important Xbox 360 exclusive, the ESPN app. In addition to the standard streaming media apps, the Xbox 360 comes with Internet Explorer, a full fledged web browser. Universal search? Check. It’s got it. If you upgrade to an Xbox package that includes the Kinect Motion Sensor, you also get voice and gesture based search. As an added bonus, you can play any of the thousands of video game titles available on the platform.

The Roku 3 is a nifty device, but feature for feature, it can’t compete with the Xbox 360. For consumers who just can’t afford the extra $100 bucks, or for users who only have enough living room space for a tiny device, the Roku 3 is a good choice.