According to a report by Advertising Age magazine, Amazon.com (AMZN) is about ready to launch its video download service sometime in the middle of August.
Ad Age also says that, "The service, which is referred to as Amazon Digital Video -- or Amazon "DV" -- has evolved over the past year from a music-themed offering to a video-centric one, according to production-studio and TV-network executives briefed on the plans. The reason? Apple, these executives said, already commands such a large share of digital-music sales that Amazon felt it would be too difficult to break into the market."
Reuters had this to say: "Financial analysts have reacted positively to the prospect of a digital download service that would contribute higher profit margins than the Seattle-based retailer's traditional e-commerce business. The company's spending in research and development has skyrocketed, and many analysts have speculated that Amazon's new digital projects are the cause."
While Amazon.com says they won't comment on what they are calling "speculation and rumour," it seems that this story has legs to it.
Another aspect of the story to consider is that it would be irresponsible to own a Web site like IMDB.com, as Amazon does, and not tap into its existing customer base with an offering like this. Being a Web company like they are, they must enter into digital downloads. Movies and TV show are the way to go, like AD Age mentions because the music download segment is too difficult at this time to compete in.
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