Just this week Amazon and Twitch announced that you can now link your Amazon prime account to your Twitch account and you will receive all the benefits of a premium Twitch account. For those who are not familiar with these platforms and the pricing models they offer, here is a brief summary:
Amazon has a premium membership that is $99 per year in the US and 49€ in Europe. This membership gives you free express shipping on Amazon and also access to Amazon Video, which can be compared to Netflix.
On the platform Twitch, people can live stream when they play games and others can tune in to watch them. The platform is very popular for e-sports and reaches 45 million viewers every month. Twitch also offer a premium membership that gives you access to ad-free view. By linking both services together, Amazon also added discounts for certain games and free in-game content to the premium membership.
Since Amazon acquired Twitch in 2014 they have not made any strategic move to combine Twitch and Amazon services and industry insiders were curious how a potential strategy will look like. Now Amazon has made its first move as described above and opened premium services of Twitch to its Prime subscribers. Considering that the premium tier at Twitch costs €8.99 (or$8.99 in the US) per month and Amazon Prime only costs €4,08 ($8.25 in the US) per month, the new offer is an excellent deal and adds another argument to Amazon Prime
In a recent move, Youtube has launched a new service dedicated to gamers that is called Youtube Gaming. With this service, Youtube positioned itself as a direct competitor to Twitch. Under these circumstances, Amazon’s move to unify its services can be seen as a direct reaction to the launch of Youtube Gaming. In addition to that, Twitch also announced that creators can now upload content directly. Before that, creators always had to live stream their content.
It remains interesting to see what Amazon has planned for the future. A possible option could be to fully integrate Twitch within its Amazon Video platform. Another thinkable option would be to expand Twitch and use its young and very active community to build a potential rival to Youtube. An advantage of Twitch here might be that it has far more experience with freemium models for its viewers, which in the end makes it more interesting for creators. For instance, it is possible to subscribe to a creator for a small fee to support him and parts of the revenues from the premium tier also go to the creator. Youtube Red, the premium subscription for Youtube, that costs $10 per month in the US, was only announced less than a year ago and is only available in five countries as of now.
What is your opinion on Amazon’s strategy? Are they doing it right? Or should they rather focus on international expansion for example, such as Netflix does? I look forward to seeing your opinions in the comment section!
For more background on the market of videos, you might also check out our technology of the week blog post here.
