Amazon shall leave no stone unturned. According to The Information, Amazon has in the works a new streaming video service that'll live separately from Amazon Prime Video that'll be be part of Amazon Fire TV devices. Dubbed "Free Drive," it'll be an advertising-supported channel. And while it's easy to say it'll be much like Roku's own "Roku Channel," which provides free news and shows on an ad-based channel — and not just on Roku devices, but now for anyone with a web browser — it's a little tougher to say why Amazon might go down this road.
From The Information:
The new Fire TV offering is separate from Amazon's ad-free subscription Prime Video service, which has become a major rival to Netflix with original shows as well as recently-released series from TV networks. The Fire TV service is tentatively called Free Dive. Amazon is in talks with major studios to license older TV shows, which have already aired on TV networks, for Free Dive, the people said.
That suggests Free Dive will be similar to what Roku offers with its Roku Channel, a free, ad-supported app on Roku-powered devices and smart TVs, the people said. Roku has publicly championed the ad revenue from the Roku Channel as a key driver of its growing platform business, which brought in $90 million last quarter.
At first glance it's easy to think that Amazon could be using Free Drive (and that's a not-great name, if it turns out to be the correct one) as a sort of loss leader to get folks into Amazon Prime Video. But there's a pretty good chance if you're using a Fire TV device, you've already got an Amazon Prime subscription. (It's not necessary to have one, but it's definitely likely.)
On the other hand, this could be exactly what it looks like. Previously aired shows (how "old" remains to be seen) that folks will want to watch, and that Amazon will be able to subsidize (if not at least make revenue neutral or even positive) with advertising. A win for users, with content they want on inexpensive hardware, and a win for Amazon in terms of adoption and eyeballs.
Of course, none of this is even official yet, so we'll just have to wait and see, won't we.
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