Why an Amazon Streaming Video Box Could Be Good for You
While not yet as intrigue-filled as smartphones and smartwatches, the rumor mill of online-video gadgets is heating up. On the heels of rumors about a new Apple TV service and snafus for Intel's OnCue online TV service comes a report from the Wall Street Journal that Amazon plans to sell its own budget video streamer, code-named Cinnamon.
Does the world need yet another HDMI-equipped hockey puck for the TV table? In a perfect world, no. But in the far-from-perfect world of tech-company rivalry and Byzantine video-distribution rights, perhaps yes. If Amazon gets into your house via its own box, rather than as an app on Roku or smart TVs, it could make an enticing offer.
John Buffone, an analyst who covers video devices for research firm NPD, told Tom's Guide that he expects Amazon to tie in its Amazon Prime membership, which includes access to a huge streaming-video library featuring two types of offerings not as widely available on Netflix: current seasons of shows, and past seasons of HBO programs like "Game of Thrones." Prime also includes free two-day shipping on Amazon purchases. If you like TV and online shopping, it could be quite a deal. "We should expect Amazon to bundle Prime with the purchase of their new set top box," Buffone told Tom's Guide via email. "It may be one-month free of prime with purchase of the box. Prime currently costs $79 per year (there is no monthly pricing).
If Amazon follows the same pricing plan as it does with Kindle devices, the price of the box will likely be rock bottom; it wouldn't be enticing if it cost more than a Roku streaming box, which starts at $49. And Google's (albeit limited) Chromecast stick is just $35.
And Amazon is unlikely to shut out other services, the Journal reports. No streaming device has left out Netflix Instant, which is — by far — the most popular online video service. HBO GO, Hulu (and Hulu Plus) and Amazon Prime are roughly tied for second place.
Cinnamon might also double as a game console, though that's a tough market. The segment is on the decline. Despite the buzz about the new PlayStation 4 and Xbox One, not that many people, beyond core fans, are planning to buy them when they come out in November. And Ouya's Kickstarter-funded attempt to build a cheap Android-based console has mostly been a flop. On top of that, Valve's plans for a SteamOS box have many people scratching their heads. But as just an add-on to a good video streamer, gaming can't hurt.
Why is Amazon building a set-top box?
So, what's in this for Amazon? Buffone theorizes that the impetus behind the company's video-box endeavor is to get Amazon Instant video in front of more people, just like it originally made Kindle e-books popular by selling Kindle devices pretty much at what it costs to make them. Encouraging people to sign up for Amazon Prime for video could also boost online buying of other products from Amazon — with the free two-day shipping from Amazon Prime as an enticement. Plus, the Journal theorizes, Amazon would know a lot more about you — if you watch video, listen to music and play games through its device — in order to market to you.
Finally, Amazon needs to make sure its video still gets into homes. Right now, people are mostly streaming Amazon videos onto game consoles, smart TVs and the Roku set-top box. Game consoles are still, by far, the most popular way to watch online video, according to NPD, followed by connected Blu-ray players. Set-top boxes come in third, and for Amazon that essentially means Roku. Apple TV (which actually sells a bit better than Roku) doesn't include an Amazon video app (though you can now stream Amazon's mobile app to Apple TV using AirPlay). And smart TVs are actually the least-popular way to watch online video, according to NPD.
Amazon is now the second-most popular app on Roku, behind Netflix (the only service the box originally supported). But Roku will be sidelining its video apps with a new software update that puts access to movies and TV shows from the formerly little-known video service M-GO on the device's home screen. Also, Roku may not be in the set-top box business forever, and could transition into a service integrated into TVs or other devices. "The next step for us is absolutely integration, full integration," Lloyd Klarke, Roku's director of product management., told Tom's Guide.
Ultimately, corporate strategy and machinations may not matter to you. But in its typical, relentless drive to get your business, Amazon might make you an offer you can't refuse.