Can Amazon's Prime Video Finally Convince Consumers to Cut the Cord?
Traditional TV and cable subscriptions have declined for years, with streaming services steadily converting consumers. Amazon (NASDAQ: AMZN) has meanwhile grown its streaming business to include nearly every facet of digital entertainment available. Here's why the company could be the one to convince people to finally cut that cord.
"Cord-cutting" is a worldwide trend that has seen millions of people leave behind their cable and satellite TV services for lower-cost streaming options. From 2019 to 2021, U.S. cable providers lost about 6 million subscribers, with cable and satellite companies losing 25 million users since 2012. Analysts project that the industry will lose another 25 million subscribers by 2025 as more people opt for digital TV options.
Meanwhile, Amazon's Prime Video retained a 19% market share of the streaming industry in 2021 and first-quarter 2022, the second highest share behind Netflix (NASDAQ: NFLX), whose share is in decline. Amazon started its digital video business with the launch of Prime Video, then Amazon Unbox, in 2006. Its original purpose was to allow customers to download movies. However, the success of Netflix and technological advances led the platform to shift focus to streaming in 2011. It began with a library of 5,000 streamable movies and TV shows, which has since seen exponential growth.
Source Fool.com