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Amazon (AMZN) Strengthens Prime Video Offerings With HBO Max

Amazon AMZN continues to make efforts in a bid to add strength to its streaming platform called Prime Video.

Recently, Amazon and Warner Bros. Discovery WBD signed an agreement regarding the distribution of HBO Max.

Notably, Warner Bros. Discovery is bringing back HBO Max to Prime Video Channels after a year-long suspension, thus reversing the decision to end the distribution deal with Amazon in 2021.

The recent deal will allow Prime members to access HBO Max for $14.99 per month and enjoy streaming the robust portfolio of movies, television, and original HBO content.

Additionally, the recent deal will also enable Prime subscribers to access the streaming service that WBD intends to launch next year. Notably, the new streaming service will be a combination of HBO and Discovery content.

We note that the latest deal is likely to deliver an enhanced streaming experience to customers. This will help Amazon attract subscribers to its Prime platform.

This in turn will contribute well to subscription revenues as well as the overall top-line growth of Amazon. This will aid the e-commerce giant in gaining investors’ confidence in the near term.

In third-quarter 2022, Amazon witnessed 9% growth in its subscription service sales, which stood at $8.9 billion.

Coming to the price performance, Amazon has lost 46.9% on a year-to-date basis.

Amazon.com, Inc. Price and Consensus

Amazon.com, Inc. Price and Consensus
Amazon.com, Inc. Price and Consensus

Amazon.com, Inc. price-consensus-chart | Amazon.com, Inc. Quote

Growing Streaming Efforts – Key Catalyst

Amazon has been making solid endeavors to bolster its presence in the booming streaming market.

Apart from the latest move, the company’s acquisition of the Metro-Goldwyn-Mayer (MGM) movie company remains its second-largest buyout after the Whole Foods acquisition.

The MGM buyout has brought MGM’s catalog of 4,000 films and 17,000 TV shows to Prime Video, which includes 12 Angry Men, Basic Instinct, Legally Blonde, Moonstruck, Fargo, Vikings, The Magnificent Seven, Shark Tank, Survivor, The Real Housewives, The Pink Panther and the James Bond series.

This apart, Amazon’s robust content portfolio remains a major positive. Its one of the much-awaited content - The Lord of the Rings: The Rings of Power, proved to be a mega hit in the third quarter. It has a viewer base of over 100 million to date. Further, there were more than 25 million viewers.

Moreover, the rising number of local originals across the world is driving the company’s Prime momentum.

Competitive Scenario

All the above-mentioned endeavors make Amazon well-poised to capitalize on the growth prospects in the streaming market further.

Per a Fortune Business Insights report, the global video streaming market is expected to hit $473.4 billion in 2022 and reach $1.69 trillion by 2029, witnessing a CAGR of 19.9% between 2022 and 2029.

This apart, this Zacks Rank #3 (Hold) company’s deepening focus toward enriching its content portfolio is expected to provide it a competitive advantage in the streaming market against players like Netflix NFLX and Disney DIS, which are also making concerted efforts to strengthen their presence in this market.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Notably, Netflix, the dominant market player, continues to make heavy investments in producing and distributing localized, foreign-language content to offer a diversified content portfolio.

Its acquisition of global rights of the documentary Descendant remains a major positive. Its Roald Dahl Story Company buyout, which has added some world-famous characters to Netflix’s portfolio, is also noteworthy.

Further, Netflix’s partnership with Dark Horse Entertainment remains another positive. Per the extended partnership, Dark Horse will continue to give Netflix a first look at its IP for both film and TV. Dark Horse projects in development with Netflix include Revenge, Inc. and Lady Killer.

Then again, Disney is benefiting from the growing popularity of Disney+, owing to a strong content portfolio and a cheaper bundle offering.

Its efforts toward the creation of a new hub for international content creation to boost the expanding pipeline of local and regional content for its streaming services remain noteworthy. The extension plan would support the worldwide expansion of the company’s direct-to-consumer business.

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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report

Netflix, Inc. (NFLX) : Free Stock Analysis Report

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Warner Bros. Discovery, Inc. (WBD) : Free Stock Analysis Report

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