Amazon’s Prime streaming service has already grown into a
huge rival of Netflix. Previous deals with TNT and a new arrangement with CBS,
Amazon has made substantial progress in a short period. It is predicted that Amazon
will spend more than $500 million on video this year.
This article also mentions how Amazon and Netflix are
“mining the data of their users” to decide which shows to license. Brad Beale, who is responsible for Amazon’s
video acquisition, said that “Data is a great proxy for what customers love”.
Although Netflix has a longer history in video streaming or
renting, when it comes to online streaming, I think Amazon has one thing that
Netflix does not have – the variety of data that can be used for prediction.
Predicting customers’ taste can be very tricky, because taste or preference of
TV shows can change easily, and historical data may not tell anything about the
fate of a new show. In short, there is a huge variability. Amazon can mitigate
this variability by combining data from its online streaming service and book
sales. Using its Prime membership service as the platform also gives Amazon an
immediate access to a large amount of potential viewers.
Question to consider: What other strategies can be used to mitigate
the variability of viewers’ preference?
Reference:
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