20 February 2017

Has Amazon set its sight on TV?

Amazon, the largest Internet-based retailer in the world, is reportedly developing plans to offer a new pay TV channel to host its original dramas and movies. The dedicated Amazon channel is rumoured to be in its early stages and is not yet guaranteed to launch. Amazon Prime members currently have unlimited access to 41,000 streaming movies and TV shows via Prime Instant videos. With more than 63 million Prime members, is Amazon likely to damage Prime’s leading USP?

 

Amazon added Prime Video to its membership package in 2014 to tackle Netflix’s growing success. It pumped a huge $1.3 billion into the service which has begun to pay off. According to research firm Consumer Intelligence Research Partners (CIRP), Prime members view video on Amazon 13.4 times per month, 1.1 more times than Netflix. It also claimed the title of the first internet streaming company to receive an Academy Award nomination for Best Picture for Manchester by the Sea.

 

As Prime Video’s audience continues to grow, it is unlikely Amazon will launch the TV channel as part of the Amazon brand. It could be planning to sell a paid TV channel similar to Time Warner's HBO or CBS's Showtime.

 

Television is increasingly being introduced outside of the traditional broadcast industry. Once exclusive to large broadcasting houses such as the BBC, retailers and network operators are realising the opportunities television offers for monetisation.

 

For companies that want to benefit from TV, the introduction of an integrated OTT platform is the most effective way. However, they must be flexible, familiar and mirror the living room experience. To fulfil the promise of the increasing demand for TV Everywhere there are many things to consider, not least the complex mix of products that constitutes the modern TV experience.

 

Today’s television consists of four distinct but inter-related services. These are:

• Live TV – watching when the programme is broadcast

• Catch up – being able to view programmes that have previously been aired

• Recording – recording programmes for playback later or to keep

• On demand – watching premium content, whether it has been aired or not, at a time of the user’s choice

 

Time will tell whether Amazon will sacrifice its Prime service to venture further into the television space.

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Sašo Todorović, CEO, T-2

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