Amazon has long labored in the shadows of Netflix and Hulu when it comes to streaming TV shows and movies. It could change all that with a rumored Internet streaming plan that would bear more than a passing resemblance to old-fashioned broadcast television—free for all, just with commercial ad breaks.
There's just one problem—Amazon denies that it has plans to launch any such service, so it likely won't be part of its big announcement in New York on Wednesday. Which is too bad, because Amazon really should do this.
See also: Amazon's TV-Streaming Box Is Almost Here
Last Thursday, the Wall Street Journal reported that Amazon was planning a big push for a free, ad-supported streaming service featuring TV shows and music videos. It would feature both original and licensed programming, and might launch "in the coming months," the WSJ report said.
Whoops. An Amazon spokeswoman told me a day later that "we’re often experimenting with new things, but we have no plans to offer a free streaming media service."
The notion, however, is entirely plausible. Amazon's least expensive—but very popular—Kindle e-readers, for instance, display “special offer” advertisements on the main screen, making their discounted price possible. The company also runs ads with movie and game trailers and lets owners of its Kindle Fire tablet stream the first episode of some shows for free.
Amazon Streaming Could Use A Boost
So free, ad-supported streaming wouldn't be totally alien to Amazon's culture. It's also got a lot of ground to make up, and could use some help.
According to NPD Group, 67% of U.S. streaming users with only one service chose Netflix in the first quarter of 2013. Hulu Plus snagged 10%, while Prime only grabbed 2%. The study confirmed that, although Amazon has been growing, it hasn't come remotely close to challenging, much less toppling, Netflix.
As for the actual streams, Sandvine’s Global Internet Phenomena Report put Netflix in the lead, with 31.62 percent of all peak downstream (i.e., download) traffic in September 2013. Amazon had just 1.61 percent.
Amazon would love to change all that. But to have any chance of success, it first needs to do one thing: expand its streaming catalog. As a subscriber, I can attest to the fact that its current free Instant Watch options for Prime members comes up short next to Netflix, Hulu, HBO GO, and others. And its own original offerings haven’t exactly lit the world on fire. (Betas is no House of Cards.)
And Then There's This Wild Card
Inventory is crucial; so is the need to make Amazon's streaming video as widely available on as many different devices as possible. (Set aside for the moment that Amazon doesn't offer the service on Android gadgets beyond its own Kindle Fire tablets.) But the company has something else up its sleeve that may help with that availability issue.
Amazon is likely to introduce its own branded streaming-TV device at its New York City press event today. Should Amazon one day change its mind and actually offer free commercial-supported streaming on that box, it would have a potent weapon with with to battle the Google gadget—not to mention Roku and Apple TV.
So far, Amazon's streaming availability has been rather scattershot. Currently, Prime members get a library of free streaming options, while others must pay to rent or buy videos. Both are available on Roku, but not on Chromecast or Apple TV. And an Amazon streaming app comes installed with TiVo boxes, but it only works for paid video.
With its own device in the mix, Amazon has the opportunity to stake its own claim in this hardware fracas. Ad-supported streaming would make its gadget that much more appealing. A cheap or free TV box that offers free streaming? That would make for one heck of a one-two punch.
Feature image by Adriana Lee for ReadWrite