As posted on Apple and Amazon: Rivals that are maybe starting to play nice
When it comes to tech giants, Apple and Amazon have one of the better rivalries.
Both are trying to be the living-room platform of the future. Apple is doing that through Apple TV; Amazon is doing that through its Fire sticks and boxes. Neither wants to cede ground to the other, which has meant they haven’t been playing nice.
The result? No Amazon Prime Video app for Apple TV owners, and no Apple TVs available on Amazon.com. For now.
Amazon and Apple reportedly have a deal to end this particular impasse. Last week, Recode reported that Amazon’s video app is coming to Apple TV this summer. On Thursday, BuzzFeed confirmed that report — and added that Apple TVs will be available on Amazon.
It’s good news for Apple TV owners with Prime accounts. Amazon has been second only to Netflix (and maybe Hulu) as far as digital operations that have built out sizable original content alongside libraries of other TV shows and movies.
It’s also good news for consumers more broadly. The whole cord-cutting/over-the-top/TV-over-the-internet thing has generally been good for people who maybe don’t want to pay for expensive cable bundles of hundreds of channels. It is also something of a mess, with availability of certain services and shows contingent on a complex web of deals and devices. Apple TV’s lack of an Amazon app was arguably the biggest example of that issue.
The terms of the deal between Amazon and Apple have not been made public, and there’s a good chance we won’t ever know how they’re splitting up the money. One possible sticking point between the companies that has been theorized centers on the cut Apple takes from the money that flows through Apple TV (it does the same thing on the iPhone).
Jeff Bezos said in 2016 that he wanted “acceptable business terms” to put Amazon on Apple TV. Apple reportedly takes 15% of the money charged by major subscriptions apps on Apple TV. Amazon may have been able to negotiate an even lower percentage, considering its leverage as a major player.
The change means that Amazon’s video app will suddenly be available to tens of millions of Apple TV owners. Apple will end up pocketing some extra cash from the money that flows through that app, and enjoy being on Amazon’s dominant ecommerce platform.
To me, it seems like Amazon is the biggest near-term beneficiary of this deal, while Apple may be the biggest long-term beneficiary.
— Brian Fung (@b_fung) May 11, 2017
If Apple and Amazon can hash out their difference, maybe there’s hope for the broader digital TV landscape. One day, it might not matter which services you want and which device you have — everything will be available on everything. Or at least we can dream.
An Apple spokesperson declined to comment, while at this point I believe my emails to Amazon PR are going directly to spam.