Amazon really wants to poach a few Netflix customers and its touting its instant video library accordingly.
The e-commerce giant said in a statement that it now offers more than 100,000 movies and TV shows in its library to rent, purchase or stream for free. Amazon Prime members can watch more than 9,000 movies as part of their membership.
None of those statistics are all that newsworthy, but the timing of Amazon's statement is notable. Why? Netlfix customers have to pick their plans by Sept. 1 under the company's new pricing scheme. In a nutshell, folks that had the streaming and 1 DVD out plan have to pick either streaming or DVDs for $7.99 each---or cough up $15.98 for both services.
For what it's worth, I went with the streaming only even though I have some serious reservations about the lack of selection. Redbox is my new DVD service---actually it was my DVD services for the most part anyway.
On the financial side, Netflix's price increases are really about escalating content costs. In Netflix's most recent filing with the Securities and Exchange Commission, the company said that has $2.18 billion committed to streaming library content as of June 30. As of Dec. 31, 2010, Netflix reported commitments of $1.07 billion. That's a massive jump in costs.
If Amazon starts a content library war, those costs are only going up.
Related:
- Disney chief Iger: Digital evolving too fast for long-term content deals
- Amazon inks NBCUniversal deal; Aims to match Netflix's content library
- Netflix secures more streaming deals with AMC, CBS
- Netflix betting on subscriber fallout in Q3, everyone over it in Q4
- Netflix makes case for its price moves, but cuts Q3 outlook
- Netflix’s pricing backlash: Follow the money, churn rates
- CNET: Don’t call Netflix’s CEO ‘Greed’ Hastings just yet
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