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Amazon (AMZN) May Partner with Viacom (VIA-B) in Standalone Instant Video Deal

February 8, 2012 7:30 AM EST
AMZN Hot Sheet
Overall Analyst Rating:
    BUY (= Flat)

Revenue Growth %: +33.9%
Amazon (Nasdaq: AMZN) has been making a move into the streaming media business for a while now with its Amazon Prime Instant Video service. But the recent announcement by Verzion (NYSE: VZ) and Coinstar (Nasdaq: CSTR) -- along with rumors that Netflix (Nasdaq: NFLX) may be integrated with Apple's (Nasdaq: AAPL) upcoming television, iTV -- is causing the e-tailer to push further into the market.

According to reports out Wednesday, Amazon and Viacom (NYSE: VIA-B)(NYSE: VIA) may be in talks to roll-out a stronger standalone subscription service.

Viacom owns content from MTV Networks, Nickelodeon, and Paramount Studios.

Amazon has been offering its Prime Instant Video service as part of a $79 annual Amazon Prime membership, which also garners members better shipping terms. But Amazon is keen to the idea of a service for non-Prime members, which may in turn raise the appeal of its Kindle Fire tablet.

Last month, Amazon said the number of videos bought or rented, as well as the number of overall customers, doubled in the fourth-quarter when compared with the same period the prior year. Reuters notes that Amazon said Prime Instant Video streams also increased 300 percent during the quarter.

Amazon is indicated for a higher open Wednesday, though Viacom is looking to start in the red.


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