Amazon’s Kindle Fire Will Become To The Video Industry What The iPod Was To The Music Industry

KindlefireOver the past five years, very few companies have single-handedly help jump-start the streaming media industry and propelled the market forward as a whole. Looking back, companies like YouTube, Adobe, Netflix, Akamai and others have impacted the market in ways that most companies will never be able to. That's not to say that many small companies aren't innovating or are responsible for contributing to the growth of the market, (think Brightcove and ViewCast) but to truly move the entire market forward you need size and scale that most companies can never achieve. (Also see: Amazon Prime Streaming Will Disrupt Netflix, Here's How)

If you asked people to make a list of the companies that have had the most impact on the online video market, Apple would probably be mentioned by many. But while Apple gets a lot of credit for completely changing the mobile and music markets, and deservedly so, Apple has done little to truly push the streaming market forward. Apple is single-handedly responsible for starting the tablet market, yet when it comes to the iPad, the fact it provides a broken web experience and makes viewing video difficult, not to mention is lacking a content subscription offering, means that Apple's inclusion on the list could be debated. One could argue that the iTunes platform by itself is enough to get them on the list, and I wouldn't disagree with that, but I think others deserve more credit.

While no one would debate the impact of YouTube, in the coming years, other Google platforms like Google TV will reach the right size and scale to push the market forward, but for now, the impact of Google TV is a few years away. The next company I think should be added to the list who has truly impacted this market and will continue to help everyone in the online video value chain is Amazon. Thanks to Amazon's AWS services and CloudFront they have made distributing video easy and affordable with their self-service model not to mention, provided a cloud based platform for a lot of other vendors in the industry. Add in the fact that Amazon now offers more than 12,000 movies and TV shows for free with Amazon Prime and Amazon's got the content offering growing quite nicely and will drive more consumer video consumption with some of the same scale Netflix did.

For me, these offerings in the market from Amazon would be enough to earn them a spot on the list. But the thing that will really propel Amazon to the top of the video food chain will be the Kindle Fire. At no time in the industry, that I can remember, has a product come to the market that is affordable, dedicated to the consumption of video and will be sold by the tens of millions in such a short period of time. Some might argue that with more than 100M of the latest gaming consoles from Microsoft and Sony deployed in the market that they would classify, but those devices are still dedicated to gaming. The Kindle Fire truly is a product that was developed to consume video and will be adopted by the masses, with video being front and center.

When Amazon announced the Kindle Fire they didn't stop at only thinking about the hardware and also developed technology, Amazon Silk, a new web browser powered by their Amazon Web Services that will optimize the browsing experience as well. And while many have talked about how much faster web pages will load with Silk, Amazon has confirmed for me that Silk "is not limited to small objects" and will be used to build full pages, including video, which should mean Amazon's Kindle Fire will see crazy fast startup times for video. Amazon also has a very good track record of coming out with newer versions of the Kindle quickly, so just imagine how the second and third generation Kindle Fire's are going to perform.

Kindle Fire's are going to sell like crazy and Amazon is going to do something even Apple couldn't do and that's jump-start the streaming media industry to all kinds of new growth and consumption of video related content. And that growth is going to help not only content owners but also all of the vendors who help those content owners create, ingest, transcode, store, manage, protect, monetize, distribute and track their content. Within the next two years, the Kindle Fire is going to become to the online video industry what Apple's iPod was to the music industry. Many times I am asked what the next catalyst is for the streaming media industry and without a doubt, my answer would be Amazon.

If you follow me on Twitter (@danrayburn) and re-tweet this post, you'll automatically be entered into a drawing to win one of three brand new Kindle Fire tablets that I will be giving away next month.

  • For an online company – Amazon is the king in the cloud.
    All the products and services are truly first class.

  • Mark

    What precisely is “broken” about the ipad web experience? And what about the netflix app is difficult? Please provide support for these odd assertions.

  • Very exciting indeed. Video and a kindle reader at a price point that makes sense. What more could one ask for? Congratulations Amazon. Thank you.

  • Luka

    Mark,
    As an iPad owner, I also bristled but think he’s referring to the lack of Flash being the “broken” element.
    Sometimes, I wish we could have Flash but Steve says Flash is bad and that’s the Word.
    I wouldn’t mind having a choice and be able to block Flash when I don’t want it. There are still lots of games and videos I can’t see but Steve says Flash is bad and that’s the Word..

  • Jim

    “Steve says Flash is bad and that’s the Word.” Wow! What a silly, fanatical statement. My cheap laptop can display every webpage, Flash or otherwise. Personally, I’d like a tablet that can do the same.

  • CarlG

    Here’s why you’re wrong. iPods go along with other things we do: walking, driving, and going to school. They fit in your pocket. The places people want to consume music are just about anywhere they aren’t talking to someone. Since people could use their iPod to consume so much more music in so many more situations, music sales exploded.
    Video is different enough that your analogy falls apart. You can’t watch a video in nearly as many situations as you can listen to music. Kindle Fires are also not pocketable, so you can’t take them anywhere unless you have a bag of some kind. In fact, most people just watch video at home or on a long commute (and, hint, most of the US drives to work, so this isn’t even possible). So Fires are barely, barely going to increase the places we consume video, and they’ll still be so inferior to streaming something on a TV using a media box or 360 that they won’t make much of an impact.

  • “Within the next two years, the Kindle Fire is going to become to the online video industry what Apple’s iPod was to the music industry.”
    That is a bold prediction. I prefer to wait and see.

  • Lucas

    Where do you get your numbers for the number of movies/shows on Amazon Prime? Everything I can find shows they have about a fourth the number of items you mention and most of that content is actually free on Hulu with Ads.

  • Hi Lucas, the 12,000 number comes from Amazon directly. On the 18th of this month they announced their inventory for Prime Streaming was now at 12,000 titles.

  • Mel

    I would suggest that for video, the Kindle Fire is at a disadvantage.
    It is too big to be portable, but at 7″ is too small to give a good video viewing experience and has too little storage (8GB) for storing high quality video files.
    In contrast, Apple has the iPod Touch and iPhone as pocketable devices as well as the much larger iPad with a screen more than twice the size of the Kindle all with vast amounts of storage (up to 64GB).
    However, time will tell whether the market agrees of course, but so far 7″ tablets have been market failures.

  • anonymous

    Having owned the iPad1, iPad2 and Xoom I believe these are poor devices for video consumption. You need to transcode your video for local storage or need to rely on an application like PlayOn or Netflix to watch streaming video. The kindle fire removes the local storage requirement and enable “native” streaming of the Amazon library through prime. Additionally, the resolution (pixel density) on a smaller screen is easier and more economical to achieve as opposed to the 10″ format that is so prevalent right now. I am looking forward to either the Fire, or one of the galaxy tabs 7.0 or 7.7 as a better form factor. I have come to hate the Xoom and iPads because they are too bulky for anything but limited use on my couch while watching tv.

  • Bob Forsberg

    “Amazon’s Kindle Fire Will Become To The Video Industry What The iPod Was To The Music Industry”?….dream on. My iPod Touch has been doing everything and more the Fire will do.

  • In my opinion it is said a bit too loud. Of course the Amazon with Fire will make a revolution in the market because of really low price but while keeping most of the kick ass functionality as for iPad, and Galaxy tab.
    Will see how the things will evolve but I think that they will change more our daily life and how we interact with PC than iPad did

  • Garance Drosehn

    Ah, yes, the broken-ness of Flash. I can watch YouTube and Netflix without flash, but the lack of flash is what holds video back on the iPad.
    Speaking of broken flash, check the “Most Vulnerable Programs” section at:
    http://net-security.org/malware_news.php?id=1863
    Biggest source of trouble on Windows is (1) Java JRE, and (2) Flash; And both of those have been kept off iOS devices.
    But sure, keep using Flash on to provide superior video platforms. The spammers of the world will thank you.

  • Garance Drosehn

    Oops, a hiccup there. (2) is Acrobat and (3) is Flash.
    Acrobat Reader *is* now available on iOS devices, but probably much less used than it is on personal computers, and hopefully will be much more likely to be kept up-to-date with Adobe’s flow of security fixes!

  • You’re basically trying to say that Amazon is going to beat out two different companies that already have ridiculous market dominance: Apple in tablets and Netflix in streaming. There’s no way. It won’t happen.

  • Hi Chris, my main point was that Amazon will move the industry forward as a whole and that very few companies can do that. Netflix has done it, Amazon will too. I’m not implying that Amazon is going to put Netflix out of business, but they have some very big advantages that Netflix does not have.

  • James

    I’m not convinced the Kindle Fire alone will move the industry significantly forward as I’m not certain that there is significant consumer interest in solely watching video on a 7″ screen. I would be interested in a Kindle Fire if the ability to queue Prime Videos (a feature not currently available) existed and the ability to start a video on one device (i.e. Kindle Fire) and finish on multiple (think Netflix and ~ 700 devices) other devices (PS3, Xbox, Roku, etc.) existed. Amazon’s best bet for truly moving the industry will probably require them to increase content selection, develop a queue feature, substantially increase the number of other devices that offer their video service and ensure the entire ecosystem (i.e web page on desktop/laptop, Kindle Fire, third party device apps/channels, etc.) are well oiled and seamless. The Kindle Fire in and of itself will not do it.

  • Ken Berger

    There is a reasonable chance the Amazon Fire will be successful, but that is still far from assured.
    Amazon does not have a very interesting content strategy yet, they do not have absolution for TV programs or current movies.
    The Amazon Prime business model is not proven and Netfilx model is breaking down.
    Apple still has the only platform / eco system that offers universal simple shared access via TV, Tablet, Phone and computer. They have the biggest installed base by far of paying content customers and until that changes they have the best chance of completing the necessary content deals that could make video over IP a significant market.
    Streaming media is a misnomer there is no such thing it is high latency cached media and the silk / AWS offers no benefit there.
    And if you think YouTube or Google TV is significant you really should try and learn about the topic you are writing about.

  • Russ Raymer

    Dan, I agree with your placement of Amazon as one who is helping others and personally moving the world of streaming video further. AWS has allowed many of us to host and stream large amounts of video at a very reasonable cost and incredible service. As far as Amazon’s serving of streaming video they have many advantages moving forward as they own and operate the network that many (including Netflix) are using, which will drop their bottom line cost and allow them to more rapidly move forward.
    I am excited to see the forward movement of streaming video, and thanks to Amazon Web Services many more small companies and organizations can now jump into the market!

  • @Ken Berger: “Streaming media is a misnomer there is no such thing”
    I don’t even know how to respond to that. There is no such thing as streaming media? Makes me wonder what I have been doing for the past 15 years.

  • EQ

    Dan– Prescient article, perfectly timed. Bezos told analysts on their Q3 earnings call yesterday that Amazon is making “millions more” Fires than it had intended.
    I recall healthy skepticism–and also a handful of optimistic forecasts– around the iPad when it launched, most of which proved not only to be dead wrong, but highly conservative even in the most optimistic case. By the end of this year, Apple will have sold ~40 million iPads. Not a bad 18 months…
    It would seem the same fundamentals in play with the iPad (mainly video) would drive the Fire… Regardless of the use-case doubts in the comments here.

  • Honestly, I think people will buy these for a lot of reasons, not the least of which is its flash support. That is something that the Ipad/pod doesn’t do.

  • Tim

    I know you are talking streaming only, but have you considered comparing it to devices like this for only $35? http://venturebeat.com/2011/10/26/aakash-android-tablet-exclusive/ ?

  • I think you have got it right with the Kindle Fire (and other tablets if i’m honest). Tablets are all about consuming media and they are made for video.
    I’m really looking forward to seeing some of the new media companies like Apple and Itunes getting into the sports streaming/video arena as the current offerings are awful. Sport could drive a lot of new people to tablets.

  • Denise

    I think the kindle fire would be perfect if it had cameras on it even if it cst a little more then it would be everything every one needs

  • CIP

    For me the iPod to the music industry has change the view of many music lovers. With iPod they have learn to walk music with them, study with them, think with them and anywhere and anyhow with them. Especially the 4th generation iPod which is really almost the same to iPhone 4. It is the best of all iPods.

  • Azon Snatcher Guy

    I just got my kindle fire, this is an amazing product! I think you are right about it being the video player standard in the future.

  • ppi

    And you really do get a lot of bang for your buck, largely because Amazon is one of the few tablet makers that can afford to sell its tablet for less than it reportedly costs to make. Amazon can take a hit on the $199 price because it expects to make some serious money through its rich ecosystem that delivers digital downloads of books, music, videos, and games.