Amazon looks to ignite streaming play with FireTV; but is it enough?

April 25, 2014 | By More

Is Amazon’s release of its long-awaited streaming set-top box enough to push it into the same league as AppleTV, Roku and Chromecast? Or is it destined for the minors?

amazon-fire-tv

Entering a crowded market is tough, even when you’re among the earliest to dip your toe.

Remember Boxee? The oddly shaped box landed with a lot of hoopla as “the next best thing.” But Boxee was slow to integrate Netflix, never got Hulu, and some TV networks refused to allow Boxee to access their websites for catch up content.

Of course, it also had a hefty price tag ($230 originally) that – with limited features – and never got it into the mainstream. Last year, Boxee was consumed by Samsung.

How will FireTV fare? Parks Associates reported that Roku had devices in 37% of broadband households that stream, and AppleTV was in 24%. Google Chromecast quickly has gained traction in the market, along with game consoles, connected TVs that are quickly becoming ubiquitous, and several other streaming video devices that hold some market share.

At $99, FireTV costs more than twice as much as either the newly launched Roku Streaming Stick or Google’s Chromecast ($35), and comes in at the same price as an AppleTV.

Amazon says FireTV has three times the processing power and quadruple the memory of AppleTV, which Amazon says, means content will launch faster. But that edge could be minimal. FireTV also comes with a remote control and enables search using voice commands.

While FireTV comes with all the expected apps, including Netflix, MLB, Hulu and access to its online catalog and Amazon Prime Video (for subscribers); it hasn’t yet signed a deal with HBO for the content providers HBO Go app, something most other players already have.

Contentwise, FireTV has access to a huge library, but Amazon consistently has played second fiddle to Apple’s iTunes, which has been relentless in its ownership of the electronic sell through and video on demand space.

Researcher NPD Group, said iTunes’ share of EST for television shows exceeds 67% (Amazon has about 10%); it’s lead in the Internet VOD space is less, but only because the field is more crowded. NPD said iTunes has a more than 45% market share of online movie rentals, and Amazon Instant Video 18%.

Amazon, like Netflix, has been steadily adding original content to its streaming service, and has signed a number of exclusive deals bringing network TV content to Amazon Prime Instant Video.

One additional wild card is that Amazon recently upped the price of its Prime service, which includes Prime Instant Video, from $79 to $99.

Amazon, obviously, expects FireTV to ignite streaming sales and hopefully fuel gains in Prime memberships. But, while the online video space is hot, FireTV just doesn’t seem to be enough of a game changer to make that much of a difference for Amazon.

The financial markets don’t seem to be buying into the launch as a major development, either. At midday today, Netflix was off about 1%, Apple was down 0.4% and Amazon was down 1.7%, a sign investors aren’t convinced FireTV will substantially impact Amazon’s efforts to expand its streaming service.

The Verge´s Review of Amazon FireTV


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Category: COLUMNS

Jim ONeill

About the Author ()

Jim O’Neill has been a business journalist since 1992, and has been writing about the digital media industry since 2007. He formerly was the editor of industry journals FierceIPTV and FierceOnlineVideo, and has worked as an industry analyst for international research firm Parks Associates. He currently is CEO and Editor of theConvergence.tv, a newsletter that takes a deeper look at the trends and happenings in the digital media industry, and continues writing research and white papers on a variety of topics in the sector. He can be reached at jim@theconvergence.tv

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