NeuLion leaderboard - 10-1-17
  • With Fire TV Updates, Amazon Continues Wrapping Its Long Arms Around the SVOD Industry

    Yesterday Amazon unveiled new search and recommendation features for its Fire TV and Fire TV Stick devices, aimed squarely at improving users’ experience with third-party SVOD services. The device updates are automatically downloaded and will enable universal voice search to over 75 video apps, including Netflix, HBO GO and soon HBO Now, as well as personalized recommendations across apps to be visible in custom rows on the Fire TV home page.

    Both updates continue the evolution of Fire TV’s role as a hub for SVOD and free video services. That’s not a novel approach, as other devices like Roku, Chromecast and Apple TV are also aiming to be central hubs for online video. And arguably, Comcast is starting to take its first steps for X1 to also become a hub, by announcing plans to incorporate Netflix later this year.

    Like those other devices, Fire TV’s improved discovery and presentation of third-party SVOD content will drive significant value for both the SVOD services themselves as well as for device users. But what’s different here is that the Fire TV updates should be seen as part of a much broader video strategy Amazon is pursuing, to wrap its long arms around the SVOD industry as a whole.

    Last December, I wrote about Amazon’s Streaming Partners Program (“SPP”), which gives Amazon users one-click access to many SVOD services, which can then be viewed across multiple devices. With the new universal voice search and recommendations features, subscribers’ awareness of great content within their SPP services will no doubt improve. That should lead to more usage, and in turn better retention.

    And since voice search will surface content from various sources (including presumably SPP services users have NOT already subscribed to), search will create new avenues for SPP services to add incremental subscribers with one-click “subscribe now” as well.

    These are great examples of how Amazon is using its own ecosystem of devices, services and software to create new value for its partners. While it was tempting to be intrigued about Netflix’s involvement in yesterday’s Fire TV updates press release, when looking at Amazon’s real goals, Netflix’s presence is in fact not a surprise at all.

    As Amazon’s CEO Jeff Bezos recently said, the company doesn’t see Netflix as a direct competitor. Rather, to Amazon, Netflix is just one more (albeit the largest), SVOD provider to which Amazon can become a valuable partner, helping drive new subscribers and better retain existing ones.

    While it’s true that Amazon is continuing to bulk up its own SVOD service with high-profile originals, Amazon is playing a totally different game in video than its SVOD brethren. Amazon remains fundamentally an e-commerce company and SVOD is just one more category which it wants to dominate, partially with its own video service, offered as a unique “physical digital hybrid membership program” via Amazon Prime, and partially by providing superb access and user experiences for third-party SVOD services.

    As Amazon continues to prove in its model, there’s no question that additional SVOD services will become available for one-click access within Amazon (btw, a great prospect is the new ad-free version of CBS All Access). As questions loom around the durability of the traditional pay-TV multichannel bundle, particularly for younger viewers, Amazon is fleshing out a completely different approach to video on demand.

    Amazon’s updated “About” section in yesterday's press release says it all: “Amazon is guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence and long-term thinking.” All of these are guiding Amazon’s video initiatives.

     
  • IBM Cloud Video - full banner - 7-7-17

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