Is Amazon a Netflix Killer? Maybe Not

Published On December 5, 2012 | Tech Business

Netflix has long held the position as the leading by-mail entertainment service, and the shift to streaming content has worked well for the company. In fact, streaming movies and television actually make up the bulk of online activity around the world, so any time a company can, they’re going to break into the market. This is exactly why Amazon is announcing monthly plans for its Prime service.

Previously, Amazon offered a yearly subscription to Prime for $79. Students could get a free subscription, while Amazon offered free monthly trials to all users who signed up. Purchasing a Kindle Fire automatically granted accounts with one month of free access. So what’s different? Amazon is now offering monthly subscriptions for $8, which is right on par with Netflix.

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Of course, you might be thinking to yourself that this doesn’t quite add up, and you’re right. A total of $79 per year is cheaper than $8 monthly, so why would anyone opt for that option? You might argue, and we think this is where Amazon is coming from, that offering the monthly services helps to brand Prime and Amazon’s Instant Video service as a direct competitor to Netflix and other streaming video services, which is true. Before this, Amazon focused on other aspects of Prime, including free two-day shipping. The subscription existed long before Amazon ventured into the streaming content market, so digital perks like access to all of Amazon’s streaming content are just the tip of the iceberg.

The monthly price plan is also attractive to anyone who might be dubious as to whether they’d enjoy a full year of Prime service. They can easily cancel at any time without losing more than $8, which could possibly lure away loyal Netflix users. The ability to purchase service when wanted is nice, and some people might not be able to afford the upfront costs. Of course, they’ll only stay if Amazon has comparable content, and this is a tricky subject.

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Amazon advertises over 100,000 titles in its collection, while Netflix reached that number by 2009. Amazon seems to be doing a good job of catching up, and it might have the leg up when you consider that Netflix often pulls titles. What is available today might not be there next week. Amazon seems to be slightly more consistent. There’s plenty of overlap, but Amazon sometimes charges more.

Ultimately, we don’t see Amazon as a Netflix killer, but it is a similar service with some extra perks that frequent Amazon users or Kindle Fire owners will appreciate.



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