Amazon.com, Inc. (NASDAQ:AMZN) push to expand into other areas of operations, away from its core business has been under immense scrutiny from investors over its lack of profitability. The giant online company is now looking to start creating its own digital content instead of relying on distribution revenue according to Fox Business Deirdre Bolton.
“Amazon.com, Inc. (NASDAQ:AMZN) is coming to a theater near you, the company is going to create and produce movies to be released in theaters. Part of the deal early distribution as well as on Amazon Prime and instant video,” said Mrs. Bolton.
Mediatech Partners managing partner, Porter Bibb, does not expect Amazon to offer any threat to Hollywood, which releases far more content annually. Netflix, Inc. (NASDAQ:NFLX) and Hulu according to the analyst should be worried the most on the fact that Amazon will be looking to acquire some market share in the video streaming business with its Prime Video service.
Amazon has already indicated plans to produce up to 12 movies annually, which will be made available on its Prime Video, faster than the one-year wait that it usually takes to stream Hollywood releases. Amazon.com, Inc. (NASDAQ:AMZN) will be looking to gain an advantage against Netflix with its standalone internet service that comes bundled with a two-day delivery package at only $99 a year.
“They are going to be small budget art pulse pictures; they are not going to threaten the blockbusters the studios are producing. What this does is cemented Amazon Prime as the titan of streaming videos,” said Mr. Bibb.
Spending on movies is expected to increase Amazon.com, Inc. (NASDAQ:AMZN)’s spending spree to the concern of investors who have continued to question the company’s lack of profitability in recent times. The push to create more content clearly highlights Amazon’s ambition in digital media. It awaits to be seen if the movie business is the missing piece that should lift Amazon from its current woes of suppressed margins.
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