Amazon has built up Amazon Channels to include more than 140 television and digital-only networks in the US, but its efforts to get the most-watched TV channels kept stalling, the sources said. Twenty-First Century Fox, Viacom and other media firms typically require cable companies or other partners to take their weaker channels along with their stronger ones. Amazon did not want to do that. It also asked networks for different provisions, including discounts based on the volume of subscribers it brings in. “That might be standard in selling, but it is not how it works with content,” said one industry source.
Amazon wanted to provide a limited bundle of key broadcast and cable networks for a set fee, similar to offerings from Alphabet’s YouTube and Hulu. The “skinny bundle” type product would have been a bid to get younger viewers who are increasingly cutting the cord in favour of viewing content from their smartphones and tablets. Amazon could still decide to change course and introduce a skinny bundle, but the talks are over, the sources said. The company declined to comment on the matter.
Amazon will now look towards offering a wide variety of television channels through its USD 99 per year Prime service. It is on track to spend at least USD 4.5 billion on video programming this year, market watchers say. The company recently bought the global TV rights to produce a series based on the Lord of the Rings, by J. R.R. Tolkien, with plans for a multi-season series to draw more viewers to Prime.
Subscribers to Prime can sign up for HBO, Showtime, Starz and other networks on an a la carte basis. Those networks have standalone subscription services, but the advantage of Amazon Channels is that it groups together separate subscriptions and makes them available through the Amazon Video app.
