Amazon to Netflix: Your Move

The folks at Amazon.com (NASDAQ: AMZN  ) seem absolutely bent on fostering the ideas and opinions of their users.

Just last week, for example, the site unveiled Kindle Worlds to enable aspiring authors to test their skills writing fan fiction.

Then, on Wednesday, Amazon took a direct shot at video streaming powerhouse Netflix (NASDAQ: NFLX  ) by announcing it will proceed with the production of five new original series. Unsurprisingly, the five were chosen based on votes from Amazon viewers among 14 possible pilot episodes offered by the company in April.

Amazon's press release -- the headline of which starts with the words "Customers have spoken" -- begins by briefly introducing two adult comedies, Alpha House and Betas, as well as three new children's shows: Annebots, Creative Galaxy, and Tumbleaf. All five series will premier on Amazon's Prime Instant Video service between now and early 2014.

Been there, done that
Netflix, for its part, is already well experienced with its own original programming after releasing five unique series of its own so far, including Lilyhammer, House of Cards, Bad Samaritans, Hemlock Grove, and the latest season of Arrested Development, which launched just last week

What's more, Netflix is also working on four other series to be released sometime between this July and late 2014, notably including a new original children's show based on this summer's upcoming movie Turbo from DreamWorks. With this in mind, and noting Netflix's vast array of dedicated children's content has served to make the service incredibly appealing to families, you can bet Amazon's huge push into kid's programming was no coincidence. 

Better late than never?
Similar to the tardy introduction of its new universal login functionality, Amazon is certainly working hard to play catch-up with the critically acclaimed content offered by its more popular competitor in Netflix. Even so, that's no reason to count Amazon out of the streaming video race, especially considering viewers played an integral part in deciding which pilots would become full-fledged series.

As a result, Amazon Prime users should possess at least some level of emotional attachment to their shows of choice, and any positive word-of-mouth will serve as a great way to push potential customers off the fence.

Who wins?
In the end, though, I sincerely doubt Amazon's push into the space will manage to put a dent in Netflix's loyal subscriber base. After all, despite the increasingly intense competition, Netflix still managed to boost its number of streaming members by more than 3 million last quarter alone, bringing the total to more than 36.3 million people.

Still, investors shouldn't lose sight of the bigger picture. Even if consumers combine the monthly cost of both services, it's still only a fraction of the price they'd pay for even a basic cable subscription. As I've written before, while this does help to explain why traditional network TV companies are growing increasingly desperate, it also goes to show there's no reason Amazon Prime and Netflix shouldn't be able to peacefully coexist.

What's your next move?
How about checking out The Motley Fool's premium report on Netflix? Inside, you'll learn about the key opportunities and risks facing the company, as well as reasons to buy or sell the stock. The report includes a full year of updates to cover critical new developments, so click here and claim your copy today.


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  • Report this Comment On June 01, 2013, at 3:23 PM, ckgod wrote:

    Amazon aka the copycat followed Netflix from DVD by mail to free streaming to subscrition streaming to original content. One thing they could not copy is what Netflix will do next month or next year... lol. I don't know how much money Amazon have wasted but they could have just bought Netflix when its stock price was low.

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