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veed beat – September 18

Amazon – The Video All-Star 1

veed beatSeptember 2018

Amazon – The Video All-Star



Amazon Video Ecosystem

Amazon: One of the most comprehensive global video players

Non comprehensive list of amazon video services, some services are limited to specific countriessource: veed analytics, company websites and Bloomberg 2018

Prime Video (B2C service)

▪ In terms of distribution strategy, Amazon is

following Netflix and partners with operators

to get integrated on traditional STBs (e.g.

Telekom or BT)

Hardware:

▪ Sources indicate that Amazon evaluates to

upgrade its Fire TV family with an HDD

tapping into the traditional DVR business of

Comcast, TiVo or Sky

▪ Amazon started to license its Fire TV OS in

order to drive reach of its TV OS

Amazon Channels (B2C service)

▪ Amazon Channels are continuously ramping

up the portfolio and silently becoming the

challenger for traditional Pay-TV

▪ Amazon has built up a comprehensive E2E video ecosystem containing software

and metadata services, hardware and video content

▪ Elements differ both in their business models as well as Amazon’s integration

depth. They range from B2B software services such as AWS Elemental for

broadcasters to VoD platforms such as Amazon Channels aimed at B2C markets

▪ Though a lot of the elements of Amazon’s ecosystem have global presence,

Amazon Channels are currently only available in US, UK, Japan and Germany

Selected recent highlights



Supported devices for Prime Video

Prime Video: reach – now also through operator partnerships

Echo Show can also be used to consume Prime Video contentsource: veed analytics, company websites and services as of Aug/Sep 2018

Smaller

Screen

Mobile/

Tablet

Web

Big

Screen

SmartTVs

Game

Consoles

Streaming

Clients

Operator

STBs

US only

US + UK only US only

US only

- announced -

UK only

- announced -DE only

Small Screen & PC/MAC:

▪ Amazon supports the relevant smart-

phone/tablet OS and is available on a broad

variety of web browsers

Big Screen:

▪ Prime Video is available on most relevant

SmartTVs and Game Consoles

▪ The next evolution is happening through

partnerships with traditional operators, as it

has been the case with Netflix

▪ Prime Video just recently launched on Deutsche

Telekom’s Entertain being well integrated in

the content discovery, recommendation and

search through deep integration of metadata

▪ So far no customer facing commercial bundling

has been announced

Take away

See some

screenshots in

the back-up



Hardware: Own devices and 3rd party hardware

1) Further devices available from Amazonsource: veed analytics, company websites and Bloomberg 2018

Amazon

Hardware

Line-Up1)

3rd Party

Hardware

with

FireTV OS

n/a

FireTV

(3rd Gen)FireTV Stick

(2nd Gen)

▪ Amazon established a substantial hardware

line-up at competitive price points and

managed to become the No.1 streaming client

in the UK and Germany

▪ FireTV started as a streaming client open for

3rd party services and continuously upgraded

with Voice, Alexa integration and potentially an

HDD

▪ Besides its classic streaming devices Amazon

also enables Alexa to control the streaming

experience as well as adding a device with a

display to its Echo family

▪ In order to further increase the reach Amazon

started to license the OS to manufacturers

(Toshiba and Insignia) and has an exclusive

partnership with Best Buy for the US market

▪ Further activities have been announced in this

area for the UK market

Big Screen Other devices

FireTV Cube

(1st Gen)

Echo Show

Fire TabletHDD extension – in evaluation -



Number of Amazon Channels Pricing of Amazon Channels

Amazon Channels: Growth and pricing

Amazon channels in Japan are not consideredsource: veed analytics, company websites and services as of Aug/Sep 2018

US 17 US 18 UK 17 UK 18 DE 17 DE 18

May 2017

August 2018

Ø

4.17 €

Ø

£ 4.30

Ø

4.32 €

Ø

£ 4.63

119

4126

157

68

52

US UK Germany

1.99 €

7.99 €

$ 19.99

$ 0.99

£ 9.99

£ 1.49

Ø

$ 5.33

▪ In the US Amazon offers by far the largest amount of

Amazon Channels and still added 38 further channels

within the last year

▪ Amazon made also progress in the UK and Germany and

substantially increased the portfolio of Amazon Channels

▪ Although a substantial growth in channels, the average

price point of channels remained fairly constant over the

last year, as well as minimum and maximum price points

▪ US channels kept their high price points above the $10

mark, while channels in the UK and Germany remained

below this psychological level

Ø

$ 5.35

$ 14.99

$ 0.99

£ 9.99

£ 1.49 1.99 €

8.99 €

+32%

+69%+100%



Live Channels

Amazon Channels: LiveTV focus

source: veed analytics, company websites and services as of Aug/Sep 2018

Live TV and On Demand On Demand

Analysis

▪ Although we have seen

significant overall growth of

channels in the US, only 2

additional channels come

with live streaming.

▪ Most of the 7 channels with

live streaming are strong

established Pay-TV brands

and services

▪ In contrast, 12 additional

channels with live streaming

started in Germany, in total

now 19 live channels exist

▪ It seems to be more common

– even for smaller channels –

to provide a live streaming

service in Germany

May 17 Aug 18 May 17’s channels Added until Aug 18

96%

4%

96%

4%

90%

10%

84%

16%

73%

27%

63%

37%



Summary and Outlook

source: veed analytics

▪ Amazon owns and controls various bits and pieces along the entire video value chain from production via technical infrastructure towards

customer facing products and data. Amazon does not only focus on its own B2C products but leverages critical B2B technology for direct

competitors (e.g. Netflix runs on Amazon Web Services)

▪ Amazon built-up a robust customer-facing video ecosystem consisting of its own video services (Prime Video, et al), hardware (FireTV

family), OS with an app framework (FireTV OS) and an increasingly slate of original productions. Although Amazon is usually not the first

mover in each of the areas, it already gained significant global market presence

▪ Key areas of the integration between its e-commerce and entertainment worlds are the bundling of Prime Video with other e-commerce

related features (e.g. shipping) and the promotion of Amazon hardware

▪ The video ecosystem of Amazon is already pretty comprehensive and we should expect continuous development, improvement and global

roll-out of all existing building blocks.

▪ Amazon is tipping the toe in the water when it comes to extended content/service bundling. We should see further bundling or packaging

activities around Amazon channels where Amazon then directly competes with the traditional Pay-TV aggregators

▪ Amazon has not fully touched the data game yet. It generates a tremendous amount of data from various sources (incl. e-commerce,

Alexa, entertainment, etc.). Products, features and further personalization will clearly benefit from this data

▪ Additionally we wanted to stress yet missing building blocks of the ecosystem which could be added in the future:

▪ Advertising could be a logical next step to unlock further revenue streams both for Amazon’s hardware and service ecosystem

▪ Amazon might invest into Cinemas – a yet growing market and interesting as additional outlet for its productions and following the

strategy to get a physical interaction with its customers as with Wholefood or brick and mortar stores

▪ A further missing link to fully gain E2E control is the access network to physically transport content from the playout to the customer – as

Google/Facebook are trialing as well. So far Amazon only runs a CDN service to optimize the content distribution but might think of

heading into other access services



Book your analyst session in our Video Showroom

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Dr. Bernd Riefler

Founder & CEO

veed analytics GmbH | www.veed-analytics.com

+49 151 58243355 | [email protected]

veed analytics offers unique international video service analytics. As a customer you

receive thorough reports, insights and analyst sessions in our show room enabling you to

maximize your business and to design outstanding video products.



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information which we consider reliable, but we do not represent that it is accurate or

complete, and it should not be relied on as such.

Distribution is only permitted without any changes or omissions – publication, in whole or in

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Disclaimer


Amazon – The Video All-Star 11source: veed analytics, Entertain STB as of September 2018

Walkthrough – Pime Video on Telekom Entertain


Amazon – The Video All-Star 12source: veed analytics, Entertain STB as of September 2018

Walkthrough – Pime Video on Telekom Entertain

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