Amazon in streaming video deal with Viacom

Feb 08, 2012 by Chris Lefkow
Amazon announced a deal with entertainment giant Viacom on Wednesday, building up its arsenal of television shows as it takes on video streaming market leader Netflix.

Amazon announced a deal with entertainment giant Viacom on Wednesday, building up its arsenal of television shows as it takes on video streaming market leader Netflix.

The licensing agreement with Viacom will give Amazon Prime members access to TV shows from MTV, Comedy Central, Nickelodeon, TV Land, Spike, VH1, BET, CMT and Logo, Amazon said in a statement.

The Seattle, Washington-based online retail giant said the Viacom deal takes the total number of videos available to Amazon Prime members to 15,000.

For $79 a year, Amazon Prime members receive free two-day shipping and unlimited streaming of movies and TV shows. Amazon has been giving away a free month of Amazon Prime to buyers of its new tablet computer, the Kindle Fire.

Amazon said the Viacom offering will include MTV's The Hills and Jersey Shore, Comedy Central's Chappelle's Show and The Sarah Silverman Program and Nickelodeon's iCarly, Dora the Explorer and SpongeBob SquarePants.

The agreement does not include Hollywood movies from Viacom's Paramount Pictures, which has a deal with Netflix, or popular Comedy Central shows such as The Colbert Report or The Daily Show with Jon Stewart.

"We are constantly working to improve the service by adding the shows that our customers enjoy the most," said Brad Beale, director of video content acquisition for Amazon.

"This deal with Viacom brings Prime customers and Kindle Fire users thousands of comedies, kids' shows, reality TV and much more from some of the best cable networks available," Beale said.

Other Amazon content partners include CBS, Fox, PBS, NBCUniversal, Sony, Warner Bros and Disney-ABC Television.

The Amazon-Viacom announcement comes two days after US telecom giant Verizon said it is teaming up with Coinstar, which operates Redbox movie rental kiosks, to launch a subscription video service later this year.

Verizon and Coinstar said Monday they had formed a joint venture that will add an online streaming option to the 35,400 Redbox vending machines located in grocery stores, McDonald's restaurants and other sites.

The Los Gatos, California-based Netflix, which offers online streaming and DVD delivery by mail, had 24.4 million US subscribers at the end of December, up from 23.8 million at the end of the previous quarter.

Netflix chief executive Reed Hastings, in a letter to shareholders last month, said he expects Amazon to eventually launch "their video subscription offering as a standalone service at a price less than ours."

But Hastings said Amazon and another online video rival, Hulu -- a joint venture between News Corp., Disney and NBC Universal -- offer only a "fraction of our content" and their total viewing hours are "less than 10 percent of ours."

Amazon shares rose 0.70 percent to $185.48 on Wednesday. Netflix shares lost 3.03 percent to $124.00 and Viacom shares gained 2.30 percent to $55.53.

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