News 5 Min Read
SteelHouse CEO Mark Douglas Weighs in on Amazon, Streaming
AWS and Same-Day Delivery Boost Amazon's Growth, Streaming More of a Value-Add
Prime Memberships Up 50% – Good News for Streaming?
With Amazon smashing earnings expectations, people are asking what led to their success. SteelHouse CEO Mark Douglas gives full credit to Amazon’s main strengths – Amazon Web Services and deliveries. “They continue to lead the world in cloud computing,” said Douglas. “The most interesting thing is Amazon has a backlog of $30 billion pre-commited to AWS.” The ecommerce giant’s cloud service led the way in driving growth, and their same-day delivery has been a huge driver for their surge in Prime memberships.
Prime membership isn’t just about delivery, however. Members get access to Amazon’s streaming service, but Douglas is less bullish on Amazon’s strengths there – at least for the time being. “I don’t think it’s a great sign for streaming, I think it’s a great sign for same-day delivery,” he said. “Amazon bundles those together for a price point of $100 or more in the US. I don’t think most people will pay that for streaming, they’re paying that for same day delivery. I think Amazon has a long way to go to compete with Netflix and Disney+.”
With recent surveys showing a majority of streaming viewers preferring ads over paying higher subscription fees, Douglas is correct. It’s the additional value of the Prime membership that’s currently leading to more signups. As Amazon continues to increase its investments into streaming, time will tell if it becomes a main driver for growth.