Amazon needs more video muscle
Amazon should consider acquiring a leading media company like CBS to strengthen its streaming platform’s muscle against Netflix. Indie research firm MoffettNathanson believes the e-retail giant’s Prime Video service simply doesn’t have enough content right now to compete with the market leader.
"Rather than build it out over time, we wonder if Amazon would embrace a buy-it model and seek to acquire a traditional media company with content creation skills, deep proprietary content libraries, sports production capabilities, and burgeoning OTT ambitions,” MoffettNathanson says. “Of all the companies available, CBS is the most logical fit.”
HBO also needs more firepower and AT&T says it is looking to up content spend on its entertainment unit. HBO currently spends $2bn a year, which is just one-quarter of Netflix’s projected budget for 2018.
“It’s been a long time since anyone has been talking about giving us money,” HBO programming president Casey Bloys told Variety. “What we’re having conversations about now is what’s the right level of programming for us to be able to keep quality control in place and have a hands-on approach.”
However, Bloys doesn’t want to trade blows directly with with Netflix and Amazon Prime.
“There is an implicit promise that when a subscriber turns on HBO, of quality,” he says. “If that changes, we have a problem. So I don’t want to get into the volume business where we’ve lost that. I do believe that we can do more and keep that brand as our north star and not lose what it stands for.”