This is great for Amazon. Looks like they're attempting to be the primary outlet for premium big-name content producers, while Netflix is trying to be the primary outlet for their own content, which has the HBOs and Showtimes shying away from doing business with them. Both Netflix's and Amazon's are viable strategies, and it'll be interesting to see which pan's out.
On the other hand, piracy has gotten way easier. The technology is already here for the more tech savvy to instantly stream (or at least quickly download) The Wire and Game of Thrones, bypassing Amazon, as well as Arrested Development and Orange is the New Black, bypassing Netflix. Netflix and Amazon aren't just competing with each other, they're competing with illegal p2p technology. And in the case of Netflix, throw in traditional premium content producers as well.
Reed Hastings currently has great hair, I expect that'll start turning grey real fast.
I briefly worked for a movie/tv streaming service whose CEO was a movie industry exec. (I worked there almost accidentally as fallout from a previously company failing and that streaming company basically taking on all of the previous company's employees as a team).
One of the big take-aways from that brief stint was realizing how much the management at traditional "content" companies hate Netflix... like seething, psychopathic hate. In their minds they are on a mission to destroy Netflix at all costs because of how Netflix's all-in-one pricing model "devalues" their content.
That's not necessarily an unfounded fear, though, is it? They're used to the kind of profit margins you can get in a world where people value a copy of one movie at $19. If that changes and suddenly copies of every movie are available all-you-can-eat for $7, those margins collapse. (Not to mention that you're splitting those seven bucks with Netflix.)
I have to think they look at how Apple managed to maneuver itself into the position of being an intermediary between most people and the music business, then look at what that did to the profit margins of the music business, and think "there but for the grace of god go I."
Oh, yeah I agree their fears aren't unfounded, but they take a really over-reactionary stance to the threat, I think.
IMO they would be better served working with companies like Netflix to figure something out that is more mutually beneficial rather than pissing away billions on half-assed alternate solutions of their own (that are designed to maintain the status quo at the expense of the obvious preference on consumers to keep things simple) like "Ultraviolet media lockers".
Of course, I'm assuming Netflix would also be a reasonable party to compromise solutions and maybe they aren't; I don't know for sure, I just know that the media guys have a very "must-destroy-at-all-costs" view of Netflix in particular.
My customers see netflix-like services as a way to get easy revenues once the premier/release time window is over. Same for music and Spotify.
By doing so, they can charge whatever they want for their productions using their own e-commerce solution (which we provide them [1]) and then get the long tail revenues that come afterwards by adding third parties like itunes, netflix or amazon.
[1] KiteBit, the direct-to-fan selling solution for video
So naturally they've got into bed with Amazon who have an all-in-one pricing model as well as a history of screwing suppliers with their dominant position to enforce wafer thin margins.
On the other hand, piracy has gotten way easier. The technology is already here for the more tech savvy to instantly stream (or at least quickly download) The Wire and Game of Thrones, bypassing Amazon, as well as Arrested Development and Orange is the New Black, bypassing Netflix. Netflix and Amazon aren't just competing with each other, they're competing with illegal p2p technology. And in the case of Netflix, throw in traditional premium content producers as well.
Reed Hastings currently has great hair, I expect that'll start turning grey real fast.