Amazon’s (NASDAQ:AMZN) $99 streaming box, dubbed “Amazon Fire TV” is now available for sale on Amazon’s website and while it has potential as Amazon adds more functionality to it over time, it’s no Roku or Apple (NASDAQ:AAPL) TV killer today. During Amazon’s presentation they said the current gaming consoles in the market are too expensive, but their box is not competitive to Sony’s or Microsoft’s and they are fooling themselves if they think otherwise. No serious gamer is getting Amazon’s box, which has no online multiplayer service, something that most Xbox’s and PlayStation’s are used for. Amazon’s streaming box would be great for casual gaming, but that’s it. Even from the gaming demos they showed off it’s no where near what games look like on the Xbox One or PS4.
Right now, the only content on the box, that matters, is from Netflix (NASDAQ:NFLX), Hulu Plus, Amazon, ESPN, Showtime and YouTube. Missing is HBO Go, MLB.TV, NHL GameCenter, NBA League Pass, Epix, Vudu, SlingPlayer, Major League Soccer, Redbox, WWE Network – all content services that Roku’s boxes currently have. While more content will come to Amazon’s box over time, we don’t know how much content it will get or how quickly it gets it. For some segment of the market, cost is the biggest factor and Roku has a box in the market that’s only $50 and works with older TVs, something Amazon’s box does not do. So some consumers will pick the Roku simply because it is cheaper than Amazon’s streaming box, when cost is the primary factor in their decision.
That’s not to say that we should count Amazon out as they have tremendous marketing power and the ability to sell a lot of these boxes very quickly simply due to all the eyeballs they have to their website. I expect Amazon to sell millions of them this year, but they aren’t doing it to make money from the hardware and their business model with Amazon Fire TV is clear. Just like their Kindles, Amazon is selling the hardware at a loss to make money on the digital content services consumed via the boxes. If it was just about anyone else in the market coming out with yet another $99 streamer, I’d say it was pointless. But in Amazon’s case, because of their diversified business model and marketing reach, it’s necessary for them to have their own streaming box.
Updated 2:52pm ET: Engadget’s hands-on experience with the box involved “noticeable delay between making selections and the next page loading” for Hulu Plus and that gaming was “not exactly perfect” with “noticeable lag when it came to input.” Amazon has posted a video that shows some of the upcoming games for the box and they are crazy if they think the video quality rivals the Xbox One or PS4.