As I was logging into my Amazon account today, a big fat Amazon Prime notice blocked my path. Here’s what it said:
Way to splash into the streaming video fray, Mr. Bezos. $7 a month for 5,000 streaming movies and TV shows can only mean one thing. Amazon wants to take a bite out of Netflix’s market share. You can access the Prime channel on your Google TV, Roku box, TiVo, XBox, Panasonic, etc.–but not your Apple TV.
According to ZDNet, this new Amazon Prime feature isn’t just about killing Netflix. It is, as Amazon always is, about selling stuff:
When shipping is removed as a barrier (Ed: Prime subscribers get free shipping), shoppers spend more dough. Amazon rivals clearly see the threat from Prime. As a result, a bevy of competitors such as Toys R Us, Drugstore.com and others have joined Shoprunner, which offers free shipping and deals via participating stores. Shoprunner is a unit of GSI Commerce, which competes with Amazon on the fulfillment side of the e-commerce equation.
GSI handles the fulfillment for companies like Toys R Us and Dicks Sporting Goods. Incidentally, Shoprunner’s annual fee is $79 too.
Streaming movies are likely to be just a start. Amazon could provide free Kindles to all Prime subscribers. Perhaps Amazon offers Web backup services via Amazon Web Services. You get the idea. Amazon could offer a lot of goodies to Prime subscribers—and probably will.
Amazon still has to beef up its streaming movie offerings to peel Netflix customers away from their pet service, and brand loyalty.
It is interesting to see competition in this area heating up.