Breakout

Amazon Will Bet You $1 Billion That You Will Cut The Cord; Here’s Why

Breakout

"You clicked it, you got it."

That's literally the backstory of two new comedies set to debut later this month as Amazon Studios (AMZN) officially enters the fray over original content. Unlike the TV-alternative offerings of comparative veterans like Yahoo Studios, Youtube, Netflix and Hulu Originals, the new 11-episode shows from Amazon can make a unique claim; Alpha House and Betas are back by popular demand.

As my co-host Jeff Macke and I discussed, that's because Amazon users have essentially already voted - or clicked - their approval of the two shows they liked best following the release of dozens of pilots back in the spring. By having viewers essentially tell the production company, in advance, exactly what they want to see - or not see - is a huge competitive advantage in the lucrative search to find the next big hit show, albeit one that carries unknown risks to the creative process.

Related: Are Sports the Last Barrier to Cutting the Cord?

"It's like the dinosaurs," Macke says of the fast-changing media landscape that's continually moving away from the traditional domain of network television. "They got killed by a comet. They didn't slowly devolve. They got killed in one, big fell swoop."

The point is that as more and more of the content we watch is being shown away from TV networks, the more incentive people will have to sever their ties to the TV, to "cut the cable,"and take their media consumption to the world of digital.

In Macke's view, the dinosaur's days are truly numbered. "In five years, the networks are dead," he predicts, pointing out that Amazon and the other newcomers simply do a better, smarter job of making programs, that rely less on "blind luck" and centralized decision-making over which programs live or die.

To be fair, the networks aren't going down without a fight and are constantly looking for new sources of revenue and ways to be paid for the shows they make. As a result, the TV industry has been able to dampen the cord-cutting effect and deliver impressive sales gains in the short term.

Of course, the original content/cord-cutting revolution will continue to proceed as quickly as it has, only if the content it produces continues to be strong, such as the Netflix-backed (NFLX) Emmy-winning show House of Cards.

In the mean time, viewers can sit back and enjoy the show, knowing full well that the competition and innovation will only continue, with Amazon already on the hook for $1 billion of content spending, and Netflix more than double that amount.

More From Breakout:

Showbiz SAC Settlements Prove How Well Crime Pays: Macke

Uncle Sam’s Image May Have Taken a Hit But Corporate America Is Stronger Than Ever: Smith

Success of Twitter’s Business Model Questioned Ahead of IPO

Rates

View Comments (553)