retail news in context, analysis with attitude

Amazon may be coming in for all sorts of criticism and second guessing from analysts, investors, pundits and self-styled experts, owing to the fact that no matter much it is able to grow sales, its commitment to investment creates high expenses that make it seemingly impossible to generate any profit.

But this doesn't mean that Amazon is changing its tune.

Yesterday, Amazon announced that it has added two new content arrows to its entertainment quiver.

First, Amazon said that it now is selling a new Fire TV streaming device, described by the Los Angeles Times as a "$39 streaming media stick … that will compete with Google Chromecast and Roku Streaming Stick. Users (can) plug the new Fire TV Stick into the HDMI port on an HDTV to stream content from Netflix, Hulu Plus, Prime Instant Video, WatchESPN, Twitch, YouTube, Pandora, Spotify and other services."

The Fire TV Stick is a less expensive alternative to the Fire TV streaming media box. that was unveiled seven months ago as an alternative to, among other devices, Apple TV.

At the same time, Reuters reports that Amazon "is buying online comedy service Rooftop Media, a small deal that underscores the Internet retailer's broader ambition of becoming a media and entertainment powerhouse." Terms of the deal were not disclosed.

The Reuters story notes that "Amazon is persisting in buying content to round out its service, with designs to take on Netflix Inc. and other online digital media services … Amazon is expected to continue acquiring digital content at a rapid clip. In past years, it began investing heavily to branch out from its online retail roots, delving into Hollywood-style content production as well as developing a line of tablets, smartphones and set-top boxes to accelerate the sale of digital content."

However, as has been noted here on MNB and elsewhere, CEO/founder Jeff Bezos's "vision of becoming a tech and media powerhouse … has drawn protests from an investor community that for years overlooked its lack of profits because of red-hot revenue growth," Reuters writes.
KC's View:
Seems clear to me while Amazon may have to adjust its approach a bit, if only to lessen the flow of red ink, the company is not going to give up on a central conceit - that in order to keep up with or stay ahead of the competition, it needs to keep investing in new products, services and technologies.