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Should media companies fear Amazon?

By Ted Chamberlin | November 13, 2017 | 0 Comments


I am not sure, but their is a potential that I could win the award for the most obvious blog post title………………..

Seriously, when I start to delve in the prospects of Amazon’s potential impact in the media and entertainment space, I have two divergent ideas:

  • Hell yes, they are a threat– Many of us in the IT space have been conditioned to react in fear when AWS develops a solution in a specific domain that is a tangent outside of compute. They have the development and engineering prowess like few in the world and can just think about technology different then most traditional companies. AWS also has the power of the entire services catalog that can enable encoding/rendering/analytics/AI/storage/networking&CDN/playout at scale.  They also have a secret weapon in the hybrid M&E workflow in AWS/Elemental.  Amazon Video has really begun to move into a higher profile with projected investments in original content to tune of $5Billion in 2018.  They have also toyed around with jumping into a add supported live video streaming services to keep up with Playstation Vue, Sling TV and Hulu live.  Amazon Primes deal to stream NFL games is genius; they will fix the lackluster experience. The totality of what Amazon and AWS has and can do to innovate in the media space is hugely disruptive.
  • Not an immediate threat- It’s never a good idea to underestimate a global giant, but being so large and technology focused can lead to a myopic view of the world. Yes, AWS has all the tools for a media company to develop and run their core streaming, content and compute applications, but they don’t have a comprehensive management framework.  Yes, AWS does have a managed service offering but its really a offering that trains organizations to operate like AWS; there is no taking on your mess for less.  I liken AWS to a large hardware chain like Home Depot or Lowes; they have a warehouse floor to ceiling of tools but they won’t operate them for you. You need to hire a contractor to operate the tools for your project.   The other disconnect I see in AWS is that they have yet to fully create synergies with between their CDN, DNS, Security platforms and the Elemental team.  AWS forces prospects to assemble support for their media and entertainment workflows themselves; an overlay SE or sales group would be a nice addition for those companies looking for a reference solution. To be fair, the Elemental team provides strong support for managing the entire workflow with support for both on-premise elements including encoders.

In weighing both sides, I see Amazon as being a clear and present danger to the established media establishment.  Amazon the supply chain in media and entertainment; they might not opt to build every link ( players, mobile devices,) but are keenly aware of how cord cutters and cord nevers will be choose OTT video over linear broadcast.  Here is a great graphic provided by my colleagues Monica Zlotogorski and Fernando Elizalde on how viewer habits are changing:


Frequency of content viewing

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