Why Amazon Fire TV is a Big Deal


Amazon (NASDAQ:AMZN) made an announcement yesterday that will ripple throughout the tech community in a big way.
The eCommerce giant announced the Amazon Fire TV, a set-top box that will compete with the Apple TV by Apple (NASDAQ:AAPL), Xbox from Microsoft (NASDAQ:MSFT), Playstation by Sony (NYSE:SNE) and even the entire business model of Netflix (NASDAQ:NFLX).
Though it may seem like just another product announcement from Amazon, already a company known for its role in many product categories, the announcement of the Amazon Fire TV is a big deal.
The product seems to be almost identical to the current form of the Apple TV, a physical box that plugs into the TV and uses a wi-fi connection to connect the TV to online content from iTunes, Netflix and Google’s (NASDAQ:GOOG) YouTube.
The difference is that the Amazon Fire TV will incorporate content from Amazon Prime, a feature that I have been long awaiting from my Apple TV.
I recently wrote about the Amazon Prime price increase, a move that irritated many customers but will ultimately be of great benefit to Amazon. Little did I know that the price increase was a precursor to the release of an easy way to connect my TV to Amazon Prime.
For $99 per year, I can enjoy unlimited free two-day shipping and unlimited access to Amazon’s huge library of movies and TV shows. Until now, the latter was only available on my computer.
Today, unlimited streaming of Amazon Prime content is available on my TV through Amazon’s Fire TV. And that is a very big deal.
When Netflix transitioned away from offering DVD’s and towards offering streaming content the market revolted, sending shares significantly lower. Since that time, shares have risen over 500% as investors have realized the true power of this business model.
Apple has long been suspected of trying to dominate our television experience though a true Apple television – as opposed to the set-top box available today known as Apple TV – remains nothing more than a rumor.
But Amazon Fire TV is very real and it will connect North America’s most powerful online retailer with our most influential source of entertainment, the television.
With features like voice search, an open ecosystem of apps and technology that predicts what you’d like to watch next, Amazon is taking things to the next level. Amazon Fire TV, it seems, isn’t just for watching content from Amazon. It is for watching all content.
“It’s the easiest place to watch Netflix,” bragged an Amazon vice president during the product announcement.
Amazon also announced an optional gaming controller, available for $39.99. Coupled with the Fire TV’s price of $99 – identical to the price of Apple TV – Amazon seems to be taking on not only the market for streaming content but also the market for gaming.
Besides Amazon’s huge library of Amazon Prime content, Amazon Studios produces content available exclusively to Amazon Prime members. The company also intends to build a large library of gaming content, a venture known as Amazon Game Studios.
Seamless voice control and unlimited access to video, gaming and music content will make Amazon Fire TV a huge hit with consumers and add tremendous value to the Amazon Prime membership.
But much more importantly, by taking on the gaming industry, the streaming content industry and the market for set-top boxes in one fell swoop, the Amazon Fire TV is a big deal.

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