Amazon has upped the ante.
If you want to use the online retailer to purchase either Apple or Google products, you have until October 29 - then they’ll be removed.
Google is likely to be hit hardest. Apple has a strong retail network, and can reach out to its customers directly, something Google can’t fall back on. Amazon - in the form of lost sales - won’t emerge unscathed either, especially with the announcement being so close to the festive season.
The move, according to Amazon, will reduce customer confusion, as competitor products aren’t compatible with its Prime video service. Instead of improving consumer experience, the strategy could cause a backlash, with many using the retailer to both trade and purchase Apple and Google products. In effect, Amazon could be putting the customer second, not first.
It’s a bold step by Jeff Bezos. Especially when you consider that Prime customers constitute just a small minority of Amazon’s total business. But it does, once again, demonstrate that the company is willing to sacrifice sales to drive its content streaming service. It should be noted that other major content providers - including Sony and Roku - will still be available.
According to Bloomberg, Amazon risks ‘diverting purchases of popular devices to competitors such as Best Buy’. Further problems could arise if Apple and Google stay true to their word and build platforms, which could, potentially, help Amazon’s content.
Jillian D’Onfro states: ‘Google's Chromecast streaming stick could actually support the Amazon Prime Video app, because Google makes its software-development kit (SDK) openly available to all developers. Apple makes a beta version of its new tvOS SDK available.’
If this is the case, Amazon might feel that it’s shot itself in the foot. And much of the coverage around the decision seems to go along with that. Michael Patcher, Analyst at Wedbush Securities said: ‘Fewer than 20 percent of Amazon customers are Prime members’. He went on to say that: ‘What about the 80 percent who want an Apple TV to stream Netflix? I think that the excuse of avoiding customer confusion is a not-so-veiled attempt to favor Amazon first-party products over third-party products, and think it was a bad move.’
Some have even labelled it ‘anticompetitive’. A weak attempt from Bezos to intimidate Apple and Google to make their products more compatible with Amazon services, something, which if you believe the report from Business Insider, is already on the cards.
While you can question the company’s decision, it does prove that it has a lot of confidence in its content. And it continues to invest heavily. The company just produced its own hit comedy show - Transgender - which will be available exclusively to Prime users. The move might even represent a strategic refocus, away from retail to a more concentrated effort on content.
Google and Apple will surely react. But Jeff Bezos has made his bed and now he must lie in it.