Source: Amazon. 

Big things are happening at Amazon.com (AMZN -3.27%). On April 2, the company unveiled its newest gadget, the Fire TV. The device will give customers access to over 200,000 streaming movies and television episodes and stands as Amazon's response to Apple's (AAPL 0.10%) Apple TV and Google's (GOOG -4.12%) (GOOGL -4.12%) Chromecast. While this is an exciting device that has a lot to offer the company's customer base, is it such a game changer that investors should consider piling into Amazon's shares, or could news of the company's innovation be overblown? (Amazon's Release)

Fire TV has some nice benefits
At $99 apiece, Amazon's Fire TV matches the cost of an Apple TV box but is expensive when placed next to Google's $35 Chromecast. Like its peers, the device allows customers to access streaming services such as Netflix and Hulu, but it has some nice additional perks.

Source: Apple.

In addition to offering three times the processing power of Apple TV and Chromecast, the Amazon device delivers a wide range of video games from companies such as Electronic Arts and Disney. To make things even sweeter, users who buy Amazon's Fire game controller for $39.99 will get a free copy of the company's first-ever game, Sev Zero.

Fire TV looks hot, but what's it worth?
Based on its offerings, it looks as though Amazon has a product that is superior to Apple TV and Chromecast (though more expensive than the latter), but what exactly will this do for the business and its shareholders? At first glance, it seems the answer might be "nothing." But when you look a bit deeper, the company's endeavor might not be geared toward making a splash. Rather, it might just be the means to an end in the business's search for more traffic online.

You see, the market for devices like these is fairly small in relation to the revenue of the companies jumping into the space. As an example, let's take Apple. In 2013, the company reported that sales of its Apple TV doubled from 5 million units to 10 million. While this is impressive, the device only brought home $1 billion of Apple's $170.9 billion in sales. Put another way, the company's foray into your living room only accounted for 0.6% of its consolidated revenue for the year.

Source: Google.

Also worth considering is Apple's market share. In a large, untapped market, there would be plenty of room to grow its top line, but the fact of the matter is that the flat-panel TV market is incredibly small. At $1 billion in sales, the company's Apple TV model made up about 25% of the total market for the year. By some estimates, the market is expected to grow by 24% over the next year, but even at that rate, Amazon grabbing a substantial share wouldn't add much to its $74.5 billion in sales.

Foolish takeaway
While diversifying its business model and picking up some extra revenue is nice, Amazon is primarily expanding into the market this way so that its customers can buy things from right in front of their television with the push of a button. At first, this will take the form of the video games and music Amazon sells, but could later allow customers to order something from their smart TV during a commercial advertising said product, which could increase the company's e-commerce market share. With e-commerce accounting for about $1.25 trillion in sales in 2013 and expected to grow to $1.51 trillion this year, Amazon's revenue implies a modest 5% market share.

Grabbing hold of more of this market will allow Amazon to grow sales rapidly. With the understanding that smart TVs can open up the door between the company and customers who may wish to make a purchase immediately while watching television, Amazon expects its move to give itself a larger piece of the e-commerce pie.

No matter how you slice it, the company's decision to jump into this market is likely a win-win. Yes, the market is small, but even if its growth rate slows and Amazon's Fire TV is a bust, the company will continue to benefit from the small customer base that uses the device. If, however, the market can grow far larger over time, the rewards could be massive for Amazon.