My friend Tim Stenovec (@TimSteno) just published a great story on Amazon’s move to create original programming a la Netflix for The Huffington Post. He was kind enough to include me in his article (thank you Tim).
He sent along a few questions as I was boarding my flight from NY to LA. As Tim was on deadline, I needed to send a thoughtful response as soon as I’d have the opportunity to turn my phone back on. The quote in italics is what made the cut…but, I also wanted to share the additional thoughts I sent along for context. Amazon’s move is an interesting one indeed and I believe it’s reflective of a bigger movement in brand publishing that’s just beginning to spread its wings.
“Content is king. In an increasingly distributed consumption economy, Amazon is betting that content creates a bridge between Amazon, its products and services, and customers.”
While this is an expensive proposition, Prime subscribers are Amazon’s prime customers…they spend a great deal more per average than everyday customers. The goal of course is to create value beyond standard Prime benefits to increase subscriptions and overall spend.
Additionally, Amazon is facing competition on new fronts via Hulu Plus but more specifically Netflix. Original content is setting the standard for value add and preference beyond the standard programming that could be considered a commodity. Amazon’s means and resources are great and I would look to Amazon to consider content to also become part of its hardware and media strategy, not only helping it compete with Netflix and the like, but also complement it in competition against Apple and other Android tablet manufacturers. And, Amazon’s just getting started. Think ecosystem…rumor has it that the company is also building a video streaming device to earn a place in the coveted digital living room.
What do you think about Amazon’s move to create original content?
The story continues…
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Content is a decision driver; viewers want to watch the content they like and select their packages or provider base on the channels they are interested in… again… the channel that they are interested in because of the content they carry, no because the number of channels they have.
The provider can have “thousands” of channels but if it doesn’t carry the ones that viewers care for, they won’t subscribe
Cannot agree more with “standard programming” is a commodity. All MSOs have very similar channel list. Therefore we are seeing different strategies to stand up and certainly OTTs (lead by Netflix) are doing a good job
Projects such as Netflix “Arrested Development” and Kickstarter funded project “Veronica Mars” are clear examples
absolutely!
In the UK, I believe Amazon also owns LoveFilm (2m subscribers), and doesn’t AWS power NetFlix?
I don’t have a way to prove it, but it seems Viacom has been using Nickelodeon as a distribution channel, featuring apple knockoff products (with the pear decal on electronic products, looking suspiciously similar to iphones, ipads and imacs) in shows like iCarli, Big Time Rush and others.
Dora The Explorer is a prime example too, featuring a computer game-like show, with fantastic distribution opportunity for merchandise all over the world.
The more you get into the kids channels, the more you understand that distribution concept…
Or maybe in a world where content is relatively cheap, too much good stuff, distribution is king?
Yes David…indeed.
I think creating original programming is a great move. Netflix has been hurting. It will die if I doesn’t evolve.
In a world where I can view content in many different places, my relationship with a distribution network is only valuable when I think they did something beyond a commodity move. I started buying books from Amazon for cheap prices when they were new, today I have 1000’s of touch points in the data they have on my preferences and stay loyal.
In video, it’s Netflix. I love them because they brought me Arrested Development Season 4. I was pirated within minutes, but I not only spent hours on Netflix that day, I’ve watch twice and much this week… and you aren’t the first one I’ve told.
Does a company have to make money on the 1st run? Maybe. But I know both of these companies didn’t buy my loyalty on a commodity move.
If it’s on track for great content the way Netflix and Hulu have, them I’m fully on board. Between those 3 services I’ve been able to completely get rid of cable TV and just enjoy all the great content from them.
I’ve found creating anything from scratch and spending the time and money to do it right always pays off and I have faith Amazon will do it right.
Does anyone know what type is being produced?
yes, you are right absolutely!
Original content creation is the key to keep your audience engaged and build brand credibility.
In my opinion, I think it is wise for Amazon to create original content. I purchased a Kindle Fire when they first came out. I love it!! In my opinion, Amazon is going about creating their brand image in an effective way. Instead of throwing everything at consumers all at once, they are strategically spacing out the release the products and services. It was only a matter of time before Netflix had another top competitor. Yes there was Blockbuster and their online service, but that didn’t last too long. I could also see Amazon and Netflix merging in the future. Since they both provide a video service and are both extremely successful companies, why not create one mega corporation?
Interesting comment Chris…thank you.