Friday, February 10, 2012, 11:30 pm
Amazon gets creative with focus on original video content
A set of job postings by Amazon for creative executives to oversee the production of original video series reflects the online retailer's interest in challenging the industry film and television studios with exclusive video content.GigaOm uncovered on Friday Amazon's listings seeking executives to work for the People's Production Company, a subsidiary of the Amazon.com group of companies. According to the posts, the two positions would oversee development of half-hour comedies or children's shows for "online and traditional distribution."
Projects for the executives would come from Amazon Studios and the positions would report directly to the VP, Series Development. They would also be expected to evaluate pilot proposals; develop series ideas with writers and artists; staff, cast and produce pilots in a "cost-efficient way" and supervise production when series are greenlit.
Amazon created its Amazon Studios initiative in late 2010, offering prize money to budding script writers and filmmakers in exchange for original content. According to the report, the company paid out $580,000 to script writers and $2.1 million for test movies last year, though the content has yet to reach distribution.
The online retailer has shown a keen interest in producing original content beyond just TV and film. It has a publishing arm that is now headed by industry veteran Larry Kirshbaum. However, Amazon's imprints have been opposed by brick-and-mortar retailers, who have banded together to block the resulting books from their stores in their fight to survive the transition to online retail and ebooks.
With the introduction of Amazon's first multimedia tablet, the Kindle Fire, last November, the company is expected to continue investing heavily in original content. Analysts speculate that Amazon is selling its Kindle device at a loss with plans to make money off increased content sales.
The retailer is also rumored to be readying a standalone video service. Currently, it offers streaming video as part of its $79-per-year Amazon Prime service. Earlier this week, Amazon announced that it had reached a deal with Viacom to bring shows from networks like MTV, Nickelodeon, Comedy Central and TV Land to Prime Instant Video.
Meanwhile, rival Apple has also shown interest in a subscription video service, but it has held off on creating its own creative studios. The company reportedly shopped around ideas for an iTunes TV subscription to studios as early as 2009, but it was unable to convince them to commit to the proposal. Apple is now believed to be working to cement partnerships with existing cable and telecommunication companies to provide content for a rumored Apple-branded television set.
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Amazon needs to get it's house in order. Unlike bulwarks of Microsoft, Oracle, Apple, whose P/Es are between 10 and 20, Amazon sits at around 140.
That says to me that Amazon is in a single-company stock bubble, and is riding their value based upon a misaligned stock price. Common sense says Amazon should be trading at between 1/5 and 1/7 of their current price or they need to get their earnings up by 5x or 7x.
They can't compete with other media companies. Can Amazon build another sub company that doesn't make money, and stay in business?