In a move that could cause Netflix to rethink its pricing model, Amazon.com on Monday rolled out a new benefit for its Amazon Prime members — commercial-free, instant streaming of more than 5,000 movies and TV shows.
That means Amazon Prime members, who pay $79 a year for unlimited free two-day shipping, now get free streaming included in their benefits list. Amazon Prime boasts millions of members, and if Netflix shares any of those customers it could lead to a mini-exodus from the streaming-video company.
Amazon didn’t directly mention Netflix or any other streaming-video service in its announcement. Rather, Robbie Schwietzer, vice president of Amazon Prime, merely positioned the offering as a way to “give members even more value.”
The Amazon Upside
With Netflix subscriptions running about $100 a year, anyone who shops at Amazon — and even consumers who don’t shop at Amazon — may see value in switching to Amazon at $79 a year for unlimited streaming and unlimited free two-day shipping.
Netflix has more than 16 million members in the United States and Canada. For $7.99 a month, Netflix members can instantly watch unlimited movies and TV episodes streaming over the Internet to PCs, Macs and TVs. Netflix has some momentum with set-top boxes and even a button on the remote controls of some TV makers, but the value-conscious consumer may opt for Amazon.
“It’s a smart move. I was expecting Amazon to do something like this. I didn’t know they would link it to the premium subscribers for free, but it makes sense,” said Phil Leigh, senior analyst at Inside Digital Media.
“The streaming service should boost Amazon’s premium subscriptions and also introduce some significant competition for Netflix. Of course, this is only the beginning. Amazon could move in other directions and offer streaming as a monthly service as well. Amazon might…