There are plenty Set-Top TV boxes out there like, Roku, or Apple TV, but none have the competitive edge Amazon can muster.
With 140,000 + titles Amazon has to offer for downloading or streaming on their very affordable Instant Video service, Amazon has a very competitive advantage to all other TV boxes. Much like with Kindle Fire HD tablets Amazon is able to sell TV boxes at a cost to gain a paying client. Instant Video service costs $79 a year and with access to all Amazon’s digital content the potential is in millions.
Another business model discussed is selling Set-Top Boxes at reasonable $100 a pop with incentive of free access to Instant Video for a year. This would make Amazon Set-Top Box a great purchase and Amazon would earn a paying client after just 12 months.
Amazon has another advantage to other streaming services. It offers Amazon FreeTime service which allows parents to sensor what is being streamed to protect their kids. FreeTime offers access to educational apps, movies, books, TV shows and games for $5 a month. With Amazon’s Prime membership of $79 a year, this FreeTime service drops to just $3 a month.
At this point Amazon’s biggest rival in streaming digital content is Netflix, which offers about the same content for about the same money. Amazon does stream some exclusive titles like Downton Abbey, or The Closer and offers to buy content rather then just stream.
It is uncertain whether Amazon will offer other non-amazon services, apps and content. It would make sense for Amazon to offer all content available to Amazon including books, apps, movies, music, TV shows and games.
Apart from Set-Top boxes, Amazon is also rumored to work on an Amazon smartphone.
Amazon already has Instant Video service on Nintendo Wii consoles.
source: Bloomberg
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