Amazon opens new online movie store
Posted
Jul 17 2008, 01:50 PM
by
Kim Peterson
Rating:
If you want to sell TV shows and movies online, you've got to keep it simple. Make it easy. Apple knows this. So does Netflix, which is expanding its subscription service online. But Amazon straight-out failed in this area with its clunky Unbox download service. So it went back to the drawing board and has a new effort out today.
The new store, called Amazon Video on Demand, has 40,000 movies and TV shows and ups the ante in the online video business with two significant breakthroughs. First, Amazon has partnered with Sony Electronics to get the store directly into the TV -- Sony Bravia TVs, specifically. Second, Amazon holds the videos you buy on its end, and you can watch them by logging in to Amazon from different computers or devices.
Amazon shares are up less than 1% to $72.13. Here are more details about the service, which Amazon chose to announce in today's New York Times.
The Sony partnership is a smart move and shows that Amazon is trying to whip that last mile between the PC and the TV. You can buy all kinds of video on the computer these days, but who wants to watch a movie hunched over a laptop, or sitting at a desk? Companies, including Amazon, have tried many ways to move that video from the PC to the TV, but it usually involved extra cables and more work.
But now, televisions are starting to get their own Internet connections. In the Bravia's case, that means a $300 device that shows Web video on the TV screen. An annoying extra cost, for sure. But future Bravias will have that feature built-in. And presto -- Amazon's video store goes straight to the TV without any effort.
Amazon already does something like this with TiVo, but users had to be patient. You couldn't watch a movie until it finished downloading to the TiVo set-top box. But Amazon's new store streams the videos, so you can watch them immediately.
The streaming part means the videos don't get stored on your computer. Amazon keeps it all "in the cloud," so to speak. On one hand, that's nice because you can access the videos on different computers and on the cell phone (as phones continue to get more sophisticated). On the other hand, your Internet connection needs to be in tip-top shape for the streaming to go seamlessly. Already, users are reporting stuttering and choppy video.
Which leads me to wonder about video quality. I'm guessing that high-definition video isn't an option, with the shoddy broadband infrastructure we have in America. So what will these movies look like on big HD television screens?
Finally, it'll be interesting to see how this all ties in to Amazon's business strategy. The store isn't going to be a huge moneymaker, because Amazon has to pay Hollywood big royalties and foot the bill for bandwidth and storage on its end. But the store will get more people logging into Amazon from more places, and Amazon can sneak more advertising and selling opportunities in there as well.
Amazon's new store opens today for a chosen few that the company has invited. It'll open to everyone else later this summer.
Here's what others are saying about the news:
NewTeeVee: "Amazon introduced a Video on Demand store today, and in one fell swoop may have turned the world of home video on its head."
TechCrunch: "Amazon is going to have a fight on its hands as it tries to wrestle its way into the living room. Apple, Microsoft, Netflix, Tivo and lots of other services are already there, hanging out with the family. I love Amazon, but I’m not sure I love them more than Apple, Netflix and Tivo combined."
Techdirt: "All of the players should take a look at how badly the multi-year DVD standards battle hurt the industry. It makes people unwilling to buy certain hardware, as they don't want to be stuck with the 'loser' a year from now. What's wrong with coming up with a single standard for streaming movies from any particular service to various TV-connected devices and computers?"
Related reading:
Audible purchase pits Amazon squarely against Apple
Blockbuster's set-top box plans
Amazon shares overvalued? Who cares?
Amazon unveils new MP3 store
