Amazon.com, Inc. (AMZN) Takes Prime Video Global, Aggressively Slashes Price

December is proving to be a very busy month when it comes to streaming video news. In the latest development, Amazon.com, Inc. (NASDAQ:AMZN) today announced that it is taking Amazon Prime Video global, launching in over 200 countries and territories.

Amazon.com, Inc. (AMZN) Takes Prime Video Global, Aggressively Slashes Price
Source: Amazon

It’s spinning the video service out as a standalone monthly subscription (no Prime membership required), cutting the price compared to the current U.S. cost and sweetening the pot with an additional six-month Prime video discount.

Amazon is taking no prisoners.

The Amazon Prime Video Announcement

Amazon’s press release went out first thing this morning. The company announced it is making Amazon Prime Video available in more than 200 countries and territories, worldwide. Customers in countries such as Canada and France who already have an Amazon Prime membership will get the video streaming service for free — just like their U.S. counterparts.

In any of the countries where Amazon Prime Video will be offered, anyone can start a free seven-day trial. After that, they get a substantial Prime Video discount rate of just $2.99 U.S. per month. After the introductory period, the rate goes to $5.99 per month. Here’s the statement introducing the news:

“We are excited to announce that starting today, fans around the world have access to Prime Video. The Grand Tour and other critically acclaimed Amazon Original Series like Transparent, Mozart in the Jungle, and The Man in the High Castle, along with hundreds of popular Hollywood movies and TV shows, are now available at the introductory price of only 2.99 a month. And what’s really exciting is that we are just getting started.”

Amazon Is Just Getting Started

One of the key takeaways from AMZN’s press release may just be at the end of that statement: “… we are just getting started.”

This implies that Amazon is getting much more serious about streaming video. For one thing, the $5.99 U.S. rate the company is promoting as the regular ongoing price for its streaming video service undercuts the competition.

Netflix, Inc. (NASDAQ:NFLX) starts at $7.99 for its entry level plan, rising to $9.99/month for HD video. It also undercuts AMZN’s own Amazon Prime Video rate, which is currently priced at $8.99/month in the U.S.

What does “just getting started” mean?

It could mean that AMZN is ready to kick off a price war, hoping to steal customers from industry-leader Netflix with Prime Video discount pricing. It seems unlikely that the current $8.99 rate will remain for American customers (Engadget reached out to Amazon for specifics on this pricing policy, but the company has yet to respond).

It could reference the one noticeable omission on its list of supported countries: China. That’s a huge and potentially lucrative market, and also one that Netflix recently gave up on.

It could also reference ramping up original content, a pedal that Netflix has punched to the floor for some time now. AMZN’s own shows featured prominently in the press release.

And don’t forget Amazon’s Fire TV video streamers.

Standalone Amazon Prime Video seems like the perfect enticement to sell more hardware. Although it seems like Amazon hasn’t quite got its ducks in a row on this one. With the announcement just 10 days before Christmas, that seems like perfect timing to goose sales of Fire TV devices. But a quick check on the Canadian Amazon site shows they still aren’t available. Maybe that will come later …

What’s certain is that Amazon Prime Video’s time as an exclusive perk for Prime members is over. AMZN spun it out as a standalone video streaming service for the American market in April and now it is a global business, set to take on Netflix.

In terms of yesterday’s post about a slew of 4K content announcements in December making Apple Inc.’s (NASDAQ:AAPL) video streaming efforts appear to fall even further behind, today’s news about the aggressive Amazon Prime Video expansion just pours more gas on that fire.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2016/12/amazon-com-inc-amzn-stock-prime-video/.

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