Amazon Building Standalone Streaming Service with Viacom

Despite already having an entry in the streaming video sector, Amazon is reportedly looking to build a standalone streaming service in association with Viacom. Amazon currently offers streaming video as part of its $79 Amazon Prime program, but is evidently looking to broaden its reach and to directly contend with the likes of Netflix and Hulu.

Considering Amazon's extensive investments over the past quarter, it is unsurprising that we are beginning to see the fruits of such expenditure. Amazon has adopted a thoroughly media-centric stance, and has demonstrated awareness of the importance of a broad ecosystem. The Kindle Fire, Amazon's affordable tablet, is designed with the sole aim of furthering content consumption from Amazon's media library, thereby accounting for the loss induced by the low price of the tablet. At the moment, without a Prime membership, consumer options are somewhat more stifled for streaming media from the tablet.

As such, Amazon's move makes sense and is strengthened by its already standing media deals. By aligning itself with Viacom, Amazon has a chance at offering an extensive library right out of the gate. Reuters reports:

Viacom, which owns TV shows and movies from MTV Networks, Nickelodeon and Paramount Studios, would be the latest of several partners Amazon has made deals with for its Prime Instant Video service. So far, major studios such as CBS Corp, Time Warner Inc's Warner Bros, News Corp's Fox, Sony Corp, Comcast Corp's NBC Universal and Walt Disney Co have licensed programming to the retailer.

Also worth noting is the fact that Amazon already owns and maintains a streaming video service in the United Kingdom, LoveFilm. Following Netflix's threadbare launch in the region, LoveFilm's extensive library has been looked upon kindly by those interested in streaming media, and has potentially given Amazon further fuel for bringing such a service to the US.

Although there is no hint at original content, unlike Redbox and Verizon's announcement earlier this week, Amazon has extensive media deals already in place, thereby contributing an air of legitimacy to its motives.

Honestly, from my perspective, Amazon clearly has a masterful comprehension of the modern technology marketplace. From its launch of an affordable tablet to its Prime program, Amazon has demonstrated a repeated willingness to modernize and intelligently innovate. If anyone can challenge Netflix's dominance in the streaming arena, it's Amazon.

The official reveal of the service seems set for this week following hints from Viacom CEO, Philippe Dauman.

Verizon and Redbox Launching Video Service

Andrew Dowell and Martin Peers for The Wall Street Journal:

Telecommunications company Verizon Communications Inc. and Redbox video-kiosk owner Coinstar Inc. said Monday they will launch an online service in the second half of the year that features streaming videos and downloads.

Although details regarding content providers are notably absent, the collaborative project certainly boasts some uniquely attractive traits. Given the physical network of Redbox machines, Verizon's exisiting media allegiances and digital network via its cellular and FiOS services, and the apparent dedication to building a standalone service, Verizon and Coinstar's plans paint a fairly cosmetically formidable picture.

Having said that, aside from a robust distribution network, Verizon and Coinstar have failed to indicate any semblance of interest in original content. Although specific content deals have not been detailed, the joint press release fails to even hint at original content - an area that is likely to become of pivotal importance in the streaming arena.

Netflix now touts over 24 million users and is actively pursuing original content deals, most notably with its impending resurrection of the popular television show, 'Arrested Development.' With Yahoo! and Hulu both following suit, it is clear that merely offering a library of other people's content will not suffice for market success.

Netflix and Hulu have both posted impressive earnings, and have repeatedly highlighted their dedication to modernization. Focusing upon streaming rather than physical distribution, although met with initial apprehension, has proved an important business model for Netflix, and Hulu's entire reliance on digital distribution is clearly paying off. Thus, it seems odd that Verizon has struck a deal with Coinstar and its Redbox machines when the communications giant evidently could've built a streaming service of its own with few hurdles to clear. 

With no content-specific details - particularly with a view to original projects - it is entirely premature to view this as a viable Netflix competitor. Vague promises of apps, an apparent desire for physical discs, and unclear content deals all provide for a thoroughly flimsy premise, and I'm accordingly unconvinced. Brand name clout aside, without concrete details and industry-upsetting deals to back it up, it will take quite a lot more for me to even mention this deal as some sort of threat to Netflix or Hulu.

The joint press release can be viewed here.