Edited on Jun 23, 2026.
Amazon launched Amazon Prime Instant Video today, giving the company's roughly $79-per-year Prime members free access to a library of approximately 5,000 streaming movies and television episodes at no additional cost. The launch is one of the most consequential moves in the broader streaming video category since Netflix made Watch Instantly available to its DVD subscribers in 2007. The communications operation around the launch has been substantial. The strategic implications for Netflix, Hulu, and the broader streaming video category are real.
This is the working profile of what Amazon Prime Instant Video actually delivers, how it positions against Netflix, and what the broader streaming video competitive picture looks like heading deeper into 2011.
What Amazon Prime Instant Video actually is
Amazon Prime Instant Video is a new free benefit for Amazon Prime members. Prime — Amazon's $79-per-year membership program — has historically delivered free two-day shipping on eligible Amazon orders. The streaming video addition expands the value proposition substantially.
The initial library includes approximately 5,000 movies and television episodes from CBS, NBCUniversal, Sony Pictures, Warner Bros., 20th Century Fox, and several other studios. The library is substantially smaller than Netflix's roughly 20,000-title Watch Instantly catalog but is being positioned as a quality-curated rather than quantity-driven library.
Streaming is available on the Amazon website, on a wide range of connected devices including Roku set-top boxes, Sony Bravia televisions, Samsung televisions, and via the Amazon Cloud Player on personal computers. Mobile device support is expected to expand across the coming months.
The Prime Instant Video benefit operates alongside Amazon's existing pay-per-title video on demand business, which has been operating for several years and continues with rental and purchase options for newer titles not included in the free Prime library.
The strategic context
The launch lands inside a broader streaming video category that has been accelerating across 2010 and into 2011.
Netflix dominance. Netflix has emerged as the dominant streaming video player. The company has roughly 20 million subscribers and is adding subscribers at the fastest rate in its history. Watch Instantly streaming has become a meaningful share of Netflix viewing.
Hulu's evolution. Hulu — the joint venture between NBC Universal, News Corp, and Disney — has been operating with both an ad-supported free tier and the paid Hulu Plus tier launched in 2010. The service is generating real subscriber growth and is rumored to be exploring strategic options including a potential sale.
Apple's TV positioning. Apple has been operating iTunes video rentals and purchases, the second-generation Apple TV launched in fall 2010, and the broader iOS device ecosystem that gives Apple a strong consumer video position.
The cable industry's TV Everywhere response. Major cable operators including Comcast, Time Warner Cable, and Cablevision have been rolling out TV Everywhere services that give cable subscribers streaming access to cable channel content. The strategy is partly defensive against the rise of standalone streaming services.
Amazon's Prime Instant Video launch repositions the streaming video category as a multi-player competitive environment rather than a Netflix-dominated single-player category.
The competitive positioning
Amazon is positioning Prime Instant Video against Netflix on several specific dimensions.
Bundled value. The Prime Instant Video benefit is free to Prime members. Amazon Prime at $79 per year is roughly the same annual cost as a basic Netflix streaming-only subscription at $7.99 per month — but Prime also delivers free two-day shipping on Amazon orders. The combined value proposition is materially better than Netflix's standalone offering for households that already shop frequently on Amazon.
Library curation. Amazon is positioning the smaller library as a feature rather than a weakness. The argument is that 5,000 curated titles produce better consumer discovery than 20,000 titles where most of the inventory is poorly known older content.
Studio relationships. Amazon is signaling that the library will grow substantially across 2011 and that the company is actively negotiating with additional studios. The implication is that Amazon's Prime member base and its broader retail relationship with studios will translate into competitive content acquisition position.
Hardware and device flexibility. Amazon's device support is broad from launch. The Roku, Sony, Samsung, and PC support gives consumers immediate access without requiring specific hardware purchases.
What this means for Netflix
Three implications for Netflix.
The competitive bar has been raised. Netflix has been operating with limited direct streaming competition. Amazon's entry, combined with continuing Hulu Plus growth and the broader category dynamics, will force Netflix to defend its market position more actively.
Content acquisition costs will rise. Studios negotiating with multiple streaming buyers will be able to extract better terms. Netflix's content costs — already growing substantially as the company shifts from DVD-by-mail to streaming — will rise faster.
The Starz partnership question is more urgent. Netflix's content deal with Starz, which provides access to recent Sony and Disney films, is up for renewal. The renewed terms are likely to be substantially more expensive, and Starz may explore alternative streaming partners — potentially including Amazon.
What this means for Hulu
The Hulu strategic options conversation has been intensifying across early 2011. Amazon's entry into the streaming category may affect the calculus.
If Hulu's owners — NBCUniversal, News Corp, and Disney — decide to sell, Amazon now joins the list of plausible acquirers. The strategic fit between Amazon's existing video infrastructure and Hulu's content library is substantial.
If Hulu's owners decide to maintain ownership and expand the standalone service, the competitive pressure from Amazon will increase the urgency.
The communications angle
For brand and PR teams thinking about the streaming video category, three operating considerations stand out.
The category is becoming a multi-player competitive environment. Communications work that treats streaming video as Netflix-dominated will not age well. The competitive dynamics are real and accelerating.
The bundled-value proposition is a real signal. Amazon's positioning of Prime Instant Video as part of a broader Prime membership signals that the streaming category will increasingly compete on bundled value rather than standalone subscription pricing. The implications for how consumers compare services are substantial.
The content acquisition story is the strategic story. The content libraries each streaming service controls — and the studio relationships that produce them — are the underlying competitive infrastructure. Communications work that does not engage with content rights and studio relationships misses the strategic story.
What this sets up for 2011
Three structural questions worth watching across the coming year.
Will Amazon expand the Prime Instant Video library aggressively? The 5,000-title library at launch is small compared to Netflix. Whether Amazon can negotiate additional content rights at competitive cost will determine how serious a Netflix competitor Prime Instant Video becomes.
Will Hulu be sold? The Hulu strategic options conversation is active. The outcome — sale, maintained ownership, or expansion — will reshape the streaming category competitive dynamics.
Will Netflix respond strategically? Reed Hastings and Netflix have multiple strategic options including more aggressive content investment, original content production, international expansion, or pricing changes. The Netflix response across 2011 will shape the broader category for years.
The bottom line
Amazon Prime Instant Video is one of the most consequential streaming video launches since Netflix Watch Instantly. The bundled-value proposition, the device flexibility, and the broader Amazon strategic position make it a credible Netflix competitor. The streaming video category that was Netflix-dominated through 2010 is now becoming a multi-player competitive environment. The implications for Netflix, Hulu, the major studios, and the broader entertainment industry are real and accelerating. The story will be one of the most-watched media business stories of 2011.
