Motley Fool is reporting that Amazon is trying to add live TV to its Prime streaming video service. Both ESPN and AMC Networks have reportedly mentioned being in talks with Amazon to add live TV content. Prime customers can already access a wide range of on-demand TV and movie content through the Amazon Video service at no additional charge, and the addition of a live option would allow Amazon to entice cord-cutters interested in services like Sling TV.
From Motley Fool
The largest online retailer might be expanding into the television industry.
Amazon.com is reportedly in talks with networks to bring live content to its streaming service. AMC Networks CEO Josh Sapan mentioned during the company's fourth-quarter earnings call that Amazon has been in talks with networks. ESPN chief John Skipper noted the same.
Last fall, Amazon expanded Prime to include add-on packages for content from Showtime, Starz, Comedy Central, and several other networks. But if ESPN is in talks with Amazon, it's more likely looking into live-streaming its network in some form of skinny bundle. ESPN's Skipper indicated that if ESPN was going to offer an over-the-top streaming service, it would be as part of a bundle of other Disney (NYSE:DIS) networks.
A cord-cutter's dream
Amazon already offers Prime members a growing library of on-demand streaming content, including two Golden Globe-winning sitcoms. In December, Amazon added the option to add on other over-the-top services such as those from Showtime and Starz, so that cord-cutters can manage all their subscriptions from one account. Typically, cord cutters use multiple subscriptions to replace their television viewing habits, resulting in multiple bills and multiple headaches.
If Amazon launches a live TV streaming bundle on top of Prime, it would offer almost everything a cord-cutter needs besides Internet service. What's more, requiring a Prime subscription would allow Amazon to undercut or provide more value than similar services such as DISH Network's Sling TV, which delivers about two dozen channels for $20 per month.
As a disruptor with two established businesses, Amazon doesn't have to make any profit on its streaming service for it to be a success. Whereas DISH is looking to make a profit from selling television service – whether that's over the top or via satellite – Amazon is looking to make a profit from retail sales. And signing up more members to Prime is exactly how it's been able to continue growing sales. Adding a low-margin live TV streaming service will probably add even more members to Prime.
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