As consumer viewer habits shift from broadcast to streaming, competition in the online video space is heating up. Amazon, the Seattle-based e-commerce giant notoriously hungry to break into hot new markets, is quickly rising the ranks to compete with industry titans like Netflix.
Amazon Video is now the third most-streamed online video service, behind Netflix and Youtube, according to a new internet usage report from Sandvine. The network hardware company’s twice annual Global Internet Phenomena Report found that Amazon’s streaming service now accounts for 4.3 percent of downstream traffic during peak evening viewing hours.
Netflix still dominates video streaming, representing 35.2 percent of traffic in North America within the past year. Netflix’s share declined slightly from 37.1 percent six months ago. The report notes that this decline is likely due to Netflix’s improved video compression technology. Measuring downstream internet activity isn’t an exact metric but it does give a sense of streaming service usage — stats that the services themselves are reluctant to provide.
Amazon’s rise is due in part to its investment in original content. Hit shows like “Transparent,” “Man in the High Castle,” and “Mozart in the Jungle” have helped Amazon Video quickly become a competitor in the video streaming space. The model was pioneered by Netflix, with original series like “House of Cards” and “Orange is the New Black.” Originally, Amazon’s original content was only available to annual Prime subscribers for $99 per year. In April, Amazon began offering a monthly $8.99 Prime subscription so members could access its video streaming service. The move was a direct swing at Netflix and its popular monthly subscription plan.
Sandvine notes that Amazon has also succeeded in landing exclusive deals to stream HBO’s acclaimed original shows, where Netflix failed. According to the report, Amazon Video is now ahead of iTunes and Hulu in streaming traffic. “With expanding services and a growing user base, Amazon’s growth surge is expected to continue,” Sandvine said in a summary of the report.