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Amazon.com is making plans to add a subscription-based video streaming service to its list of offerings and is trying to drum up support for it among media companies, the Wall Street Journal is reporting. The publication said that the service would compete quite well with Netflix’s Instant Streaming option, as well as Google’s recently announced Google TV offering.
But it’s Google that might have the most to be concerned about with Amazon’s new service. The e-retailer’s streaming option could become a direct competitor to Google TV. Even more significantly, it will join a growing number of markets in which the two Web giants compete, potentially causing even more trouble for Google.
Here is why Amazon should worry Google:
1. Amazon streaming
As mentioned, Amazon plans to deliver streaming content. Exactly what the company has planned for that offering is unknown. But Amazon is a well-known entertainment provider, thanks to its video-on-demand service and MP3 store. In other words, it has customers. And so far, Google doesn’t. Having to overcome Amazon’s head start in the streaming business could be a tall order for Google.
2. Cloud integration
Amazon has done a fine job delivering cloud services to the corporate world. But now, its offerings, including EC2, compete with Google’s own slate of cloud services. So far, Amazon’s business hasn’t been hurt all that badly. And it’s highly unlikely that Google will be able to steal much market share from Amazon anytime soon. But the battle is only starting. And both companies will likely dole out boatloads of cash to win out.
3. The e-reader debate
Amazon’s Kindle is a major player in the e-reader market. But Google delivers electronic books of its own online. The company announced earlier this year that it would integrate its Google Books library of titles (and others) into Android OS. Exactly how the e-books space will turn out due to that decision is anyone’s guess. But one thing is certain: Google will have some work to do to catch up to the Kindle.
4. E-Commerce search plays a role
Amazon is becoming a significant player in the search market. The company’s A9 services allow users to perform a product search, similar to Google’s Product Search. And its advancements in search are making the company a bigger player in that space. For now, Google has nothing to worry about. But if Amazon sees growth in its search services, it’s possible that it will spend more of its time in that market.
Amazon Entering Online Fields Coveted by Google
5. Google TV concerns
As mentioned, Google plans to break into the entertainment market with the Google TV service. The software, which will run on set-top boxes and other devices, will offer users the ability to watch television shows, movies, and search the Web. Amazon won’t provide all that, but it will offer an alternative entertainment platform. And it’s entirely possible that if it’s successful, hardware won’t be far behind it.
6. Enterprise focus
Amazon might be best known as an e-retailer, but the company is a fine enterprise services provider. In fact, it delivers cloud storage, Web advertising, and a business platform for companies that want to sell products on its site. Meanwhile, Google is continually trying to infiltrate the enterprise with its own lineup of enterprise Software as a Service offerings, including Google Apps for Business. It won’t be long before the companies start battling it out more directly in that market. For now, it seems that Amazon has an attractive slate of online services for many companies.
7. The hardware business looks appealing
With streaming services coming soon, the Kindle selling well, and the iPad continuing its growth in the tablet space, it’s not a stretch to say that Amazon will focus more of its efforts on the hardware market going forward. Since Google offers Android OS and soon, Chrome OS, the company has a vested interest in seeing its partners’ hardware succeed. With Amazon also competing more in that space, the market will only become crowded. Thus it could be difficult for Google to enjoy the kind of success that it hopes to achieve.
8. Advertising
Google is the top Web advertising company in the world. So far, no other company has even come close to matching the firm. But Amazon’s Clickriver ads service is compelling. The company’s offering allows companies to “match services to products and to content on Amazon.com and other premium Web sites.” It’s highly focused. But it has the potential to be extremely profitable. Google, a company that’s always looking for advertising opportunities, may take issue with that.
9. Size matters
Size matters in the tech space. The big firms do well, while the small firms need to find areas where they can compete. Both Google and Amazon are major companies, meaning no firm has an advantage over the other. Google might be more successful in the advertising market, but it can’t compete with Amazon in retail. And both firms have vast reserves of cash to expand their operations. In other words, expect a battle between both of those Web giants.
10. Consumer trust
Consumer trust has helped Google become such a success so far. People know that when they use a Google product, they will enjoy an experience that potentially matches or bests the competition. Aside from Apple, Google hasn’t been faced with another company that enjoys such trust. But it could with Amazon. The online retailer is a major force in cloud computing resources, it’s a key player in the e-reader market, and it has its sights set on several new spaces. All the while, consumers trust it.
Get ready for a big fight between Amazon and Google.