The attention around its content acquisitions suggests a budding rivalry with Netflix and a strategy of stocking up on films and TV shows for the tablet computer that the company is developing. Much like Apple, Amazon wants to have an assortment of content available for owners of the forthcoming device.
The NBC deal gives Amazon nonexclusive access to films like “Elizabeth,” “Babe” and “Billy Elliott.”
Last week, Amazon and CBS announced a similar deal that lets Amazon stream about 2,000 episodes of older TV shows like “The Tudors” and “Medium.”
In both cases the content is available through Amazon Prime, a $79-a-year membership service that gives buyers free two-day shipping. The five-month-old streaming service is available at no additional cost for members.
Amazon is just one of the Internet companies that is seeking to compete more directly with Netflix, which has about 25 million subscribers, many of whom stream films and TV shows, but which may look vulnerable this summer and fall as it imposes a price increase for some subscribers.
Netflix acknowledged in its earnings letter to shareholders this week that both Amazon and Hulu Plus, the subscription arm of Hulu, are in the marketplace, but noted that it has “vastly more streaming content” than Amazon and has many more customers than either service.
“So far, we haven’t detected an impact on our business from Amazon Prime,” the letter from Netflix stated.
For media companies, the suitors are welcome. At the time of the Amazon-CBS deal, Anthony DiClemente of Barclays Capital said that he believed CBS was in talks with other online distributors for similar deals, citing Microsoft, Facebook and Google, which owns YouTube, as potential partners.
Given that multiple online distributors are bidding for such content, “we remain of the belief that digital media distribution is an incremental boon to core film/TV studio economics, as media content owners like CBS continue to benefit from the simple laws of supply and demand,” Mr. DiClemente wrote in an analyst note.
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