Amazon.com Inc., which is known as the largest online retailer in the world, has began a rights acquisition campaign towards the media companies in the U.S.
The people, who asked not to be named because the negotiations are still not public, said that the company is reaching for an online pay-television service, which would help it expand on the Web retailers Prime Instant Video subscription service.
Amazon.com intends to do so by offering live programming similar to traditional pay-TV providers. The companys undertaking is expected to bring the number of companies planning Web-based pay-TV businesses to compete with existing cable and satellite providers in the U.S. To three. This month Sony Corp. announced that it plans to offer an online service, and Verizon Communications Inc. revealed that it plans to expand its reach beyond the already existing FiOS territories thanks to a technology purchased from Intel Corp.
One of the spokesmen of Amazon.com Inc. – Drew Herdener said in an e-mail statement, cited by Bloomberg: “We continue to build selection for Prime Instant Video and create original shows at Amazon Studios. We are not planning to license television channels or offer a pay-TV service.”
Amazon.com explained it has been moving into entertainment segment, which is headed by Netflix Inc. that is considered the subscription-steaming leader. The Amazon Prime service that is to be launched by the company provides users with unlimited viewing of 41,00 films and TV shows, free shipping and book rentals. People familiar with the matter reported that television set-top box was planned to be released by the retailer in April 2014.
One of the analysts working for Barrington Research Associates – Jim Goss said in a phone interview cited by Bloomberg: “To be successful, an over-the-top service, whether thats from Amazon or anyone else, will have to be incremental and not threaten to cannibalize media companies existing business model.”
Over the last few years, the users interest towars subscription-streaming services such as Amazon Prime, Netflix and Hulu LLC has increased, because people like watching shows whenever they want on various devices from TV to smartphones and tablets.
According to CNN Money, the current share price of Amazon.com Inc. is 1.86% up, and the one-year return rate is 2.07% up. The 38 analysts offering 12-month price forecasts for Amazon.com Inc. have a median target of 420.00, with a high estimate of 500.00 and a low estimate of 320.00. The median estimate represents a +3.18% increase from the last price of 407.05.
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