Amazon appears to have tipped its hand that it will be funding original content for the Amazon Prime streaming video service in recent days, but video isn't the only area where Amazon is blurring the lines between its role as a distributor and a new role as publisher.
In its books business, for example, Amazon already has become a publishing entity, not simply a retailer of other publishers' products. Something like that is expected for the Amazon Prime streaming service as well.
In that regard, the streaming services are following a business strategy long used by video networks and distributors alike, namely original programming as a way of creating differentiation and uniqueness for a particular service.
Cable TV networks, for example, long have built on a signature series or two to pull viewers into the channel, while most of the fare is more familiar and not "unique" licensed material. That seems to be the same thinking driving investments by Netflix, Hulu and YouTube in original programming not available elsewhere.
Netflix, for example, is producing an original series to be produced by Media Rights Capital. The drama series "House of Cards" will be executive produced and directed by David Fincher and executive produced by, and starring, Kevin Spacey.
Netflix reprtedly got rights to the series by offering a relatively unusual commitment of two seasons, or 26 episodes. Given that the price tag for a high-end drama is in the $4 million to $6 million an episode range and that a launch of a big original series commands tens of millions of dollars for promotion, the deal is believed involve an investment by Netflix of more than $100 million.
Such a move is traditional for premium cable networks trying to increase value and add uniqueness to their services, and Netflix clearly is aware that unique content not available elsewhere will be a draw for its streaming service and subscriptions.
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