Amazon and Netflix up a tree!
TechCrunch is reporting on the rumor that Amazon is looking to buy Netflix. Another purchase that I think does well by both of them. I, obviously, have no idea if it is true or not, but if it does turn out to be true I think that both companies would do well by it. Amazon is clearly making a move into the movie/dvd industry, their initial foray (unbox) being somewhat less than a wild success. And Netflix, while a great service, is being harried by Blockbuster and I’d guess that they’ve got their eye on iTunes and the nascent AppleTV.
I think that Amazon will benefit from some direct movie know how that they can garner from Netflix, with a built in customer base they’ve got a great starting point to launch more efforts into the space. They’ve also got a lot of big brains there, a lot of computing infrastructure and an unbelievable distribution network - all things that Netflix could sure do well by. Having it’s fingers in both sales and rentals can’t hurt the company either. And don’t forget that Amazon also own imdb.com - one of the greatest assets on the internet (well, if you ask me…). They can long tail the crap out of that and send all kinds of traffic to Netflix for movies that they don’t necessarily need to sell the DVD to. And it could be one more e-commerce transaction on movies, especially ones that Amazon doesn’t stock - buy new, buy used and rent. I’d imagine that’s got a ton of possibility to grow Netflix like crazy.
So, this is definitely a move that I’d think was good for both companies. Perhaps with some Netflix savvy they’ll be able to spruce up unbox! It could happen. While other companies make the big flashy moves, I think that Amazon is making smaller really smart ones. That’s why I’ve always admired Amazon, throughout it all, they’ve always quietly done their own thing and have generally been right about what they’ve been doing (ok, except for the whole patent thing). I can dig it.
UPDATE: Reuters says it’s unlikely because of some kind of state taxation deal. It would be a bummer if I had to start paying tax on all my Amazon purchases!
