Growth Strategies

With Original Movies, Amazon Looks to Drive Interest to Prime's Other Perks

With Original Movies, Amazon Looks to Drive Interest to Prime's Other Perks
Image credit: Nic McPhee | Flickr
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Is Amazon gunning for some Oscar gold, or trying to get customers to see its Prime membership for more than just its shipping perks? The answer: Both.

Following two wins at this year's Golden Globes for the original series Transparent, Amazon announced this week that it is getting into the movie business. The ecommerce giant will start producing and acquiring films, release them in theaters and then stream them on Prime Instant Video four to eight weeks later. That's a much shorter time frame than the traditional release model, where movies come to streaming services (and DVD and Blu-ray) anywhere from 39 to 52 weeks after their theatrical debut.

In a statement released Monday, VP of Amazon Studios Roy Price said the company is aiming to develop 12 movies in the upcoming year. "Not only will we bring Prime Instant Video customers exciting, unique, and exclusive films soon after a movie’s theatrical run, but we hope this program will also benefit filmmakers, who too often struggle to mount fresh and daring stories that deserve an audience.”

Related: Amazon's Jeff Bezos: 'I've Made Billions of Dollars of Failures'

The move serves to draw attention to Amazon's streamed video content – both original and not – which has long been offered for free to members of Amazon Prime. For $99 a year, Prime members get unlimited access to movies, TV shows and music, but much of that gets overshadowed by its most significant perk: free two-day shipping.

"We know that the majority of reasons people use Prime is for shipping and other benefits,” says Gartner analyst David Mitchell Smith. “Many don’t even know about the content." He went on to note that when users opt to plunk down $99 for year-long Prime memberships; they generally don't do it to watch TV or movies. "It is based on other benefits primarily driving the interest."

Competing services like Netflix – which, at $8.99 a month, costs more than Amazon Prime – don't have that issue, as content is their only business. The two services appear pretty close in subscriber growth: Netflix today reported that it has more than 47 million users worldwide, and plans to add 4 million more by March. Back in September, Amazon Prime was estimated to have as many as 50 million members across the globe.

Related: Ecommerce Giant Amazon Wants to Woo the Inventor Entrepreneurs

While movies are on the horizon, Amazon is still working to bolster its TV cred. Last week, the company rolled out its fourth batch of pilots. As in previous Amazon pilot seasons, viewers can watch for free, and vote for the shows they most want to see made into a series – although the company also courted controversy last week when they announced a television deal with the embattled Woody Allen.

The company's current slate of original series come from notable names like Roman Coppola and Jason Schwartzman (Mozart in the Jungle) and Garry Trudeau (Alpha House), with greenlighted projects from Steven Soderbergh to come. The critically loved Transparent, was renewed for a second season in October.   

Amazon Original Movies will be headed up by Ted Hope, an Academy Award and BAFTA-nominated veteran independent film producer. 

Related: Amazon Adds Bidding Option for Fine Art, Collectables

Edition: November 2016

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