GoPro (NASDAQ:GPRO) recently launched its content channel on the Amazon (NASDAQ:AMZN) Fire TV network for its set-top box and streaming stick. The GoPro Channel features a mix of professional and user-created videos, and doubles as a promotional channel for its cameras.
According to GoPro CEO Nick Woodman, the company currently runs the "number one brand channel on YouTube" with over 3.5 million subscribers. To promote its arrival on Fire TV, GoPro is offering an exclusive video to Amazon viewers until Dec. 14.
The Amazon Fire TV is currently tied with Roku as the third most popular streaming device worldwide as of the third quarter, according to research firm Strategy Analytics. Both devices reportedly control 16% of this growing market. GoPro signed a similar distribution deal with Roku earlier this year. The channel can also be viewed on the Microsoft (NASDAQ:MSFT) Xbox, Virgin America flights, and other devices and services.
Understanding GoPro's media strategy
GoPro has talked a lot about expanding the GoPro Channel into a full-blown media platform. The company hired numerous media veterans to develop the business, but investors still haven't seen much progress made toward monetizing the platform. Nonetheless, GoPro has taken a few baby steps in the right direction.
GoPro's partnership with Microsoft, which was announced last January, enables viewers to directly purchase GoPro cameras and accessories from the Xbox Channel. GoPro splits revenue from those sales with Microsoft. In July, it launched a content licensing portal to sell photos and videos to companies and split that revenue with the content creators. In October, GoPro expanded that effort with the GoPro Awards, which offered users cash awards for capturing interesting photos and videos which could be delivered to its licensing portal.
How can Amazon help GoPro?
Amazon's GoPro app will include playlists, activities, search, and product discovery features. GoPro didn't say if the product discovery feature will be integrated with Amazon's online marketplace, but it would be a smart next step if the channel proves popular.
Amazon started advertising physical products through the Fire TV's top banner in late October, which could be purchased with a few clicks on the remote. The device doesn't offer a full online store like its mobile app yet, but GeekWire reports that Amazon is currently developing a QVC-like online shopping channel for the device. Product links could also eventually appear in the Fire TV's "X-Ray" feature, which is used to fetch more information about onscreen content.
Those e-commerce enhancements would perfectly complement the GoPro Channel on Fire TV devices. If GoPro can ink a deal with Amazon to share revenue from camera purchases similar to the one it inked with Microsoft, it could set up another direct link between its videos and physical purchases.
The 4k factor
The Chromecast and Apple TV currently command larger shares of the streaming device market than Amazon and Roku, according to Strategy Analytics, but neither leader's latest devices support 4K video. Amazon's new Fire TV set-top box and the Roku 4 both do.
That difference matters to GoPro, since its flagship Hero 4 Silver and Black cameras can both capture 4K video. That difference should be apparent to viewers on the Fire TV and Roku 4, and serve as a better promotion for its top-tier cameras. That's probably why GoPro signed those distribution deals with Amazon and Roku as well.
GoPro still faces major challenges
GoPro's deal with Amazon is a positive development, but the action camera maker still faces major headwinds in the near future. The company recently slashed the price of its newest premium camera, the Session, from $400 to $200 due to lackluster demand. The company also expects fourth quarter sales to fall 17% annually due to a lack of new flagship devices for the holiday season. GoPro might generate fresh revenue next year with sales of drones and new cameras, but it has revealed very little regarding those plans.
For now, expanding its presence to the Fire TV will strengthen GoPro's brand recognition. Whether or not that recognition will translate to actual sales, however, depends on how deeply it can integrate its channel into the e-commerce backbone in the future.