Amazon Isn’t Yet a Competitor to Netflix, but Stand By (Network Series)

Amazon Studios

If you ask the folks at Netflix about whether or not they have any competition, they will answer in the negative. No one, they will say, puts out either the quantity nor the quality of the programming they produce, and while they don’t bat 1.000 with what they put on their site, the success rate is rather high.

But ask people who work at another streaming service, and you’ll get a different answer. Amazon Studios, for instance, considers itself as notable and impressive an operation as Netflix does, just with not as much content. Yet.

That could very well change, though, because Amazon is making a concerted effort to expand its programming, and with as much rapidity as it can handle. True story, an Amazon development exec recently commented that his job currently resembles the clichéd and legendary image of a job back in the heyday of the studios. He and his fellow execs entertain pitches, and then either say that something isn’t for them, or they shrug and say, “Why not? Let’s go for it.” Their level of freedom is astonishing and unlike anything else in the business these days.

The reason? Because they have what is, almost literally, a bottomless well of money to spend. Amazon is, after all, one of the biggest companies on the planet, earning billions of dollars from all the things it sells, having revolutionized the way people shop. Thanks at least in part to Amazon, for instance, the Borders bookselling chain went out of business, and the once monolithic Barnes & Noble is on the ropes. And that’s just with the selling of books, which is how Amazon began. Now, it sells just about anything you can find under the sun, and because of its Amazon Prime initiative, in which consumers don’t just get bargains on two-day shipping but also get to stream programming for free, it had a built-in audience for anything it might provide.

TransparentAmazon Studios

Thus, creating original material of its own — first with television programming and then with feature film production — became a no-brainer. So, in 2013, that’s what it did, but in a most revolutionary way. Unlike every other production entry out there, before the company decided on which projects it was going to green light for a full season, it actually asked its viewers what they thought.

In the spring of 2103, Amazon put 14 pilots online for people to view and then vote upon, with the top five getting a green light to series. Three of those — Annedroids, Creative Galaxy and Tumble Leaf — were kids’ shows, and just two, Alpha House and Betas, were for adults. The former show lasted two seasons, the latter just one, but Amazon had officially entered the ring and there was no going back.

Especially when, a year later, it premiered another batch of five shows, one of which was Transparent, a project that has served as a game changer in more ways than one. Aside from altering the conversation about transgender storytelling and performers and the mainstreaming of both, it has become one of the most respected shows on television and gives Amazon a level of gravitas sought by … well, everyone, really. With just that one program, Amazon can insert itself into any conversation about TV’s New Golden Age, and it’s impossible to argue against it.

In that aspect alone, of course, Amazon has firmly planted itself in the game as a real and genuine player, even if it is not yet in the same league as Netflix from a quantity perspective, it’s hard to argue against the quality aspect, at least part of the time. Like the mining of Michael Connelly’s novels about an LAPD detective for one of television’s best procedurals in Bosch, and the adaptation of the Phillip K. Dick novel The Man in the High Castle into a haunting, thought provoking and grounded sci-fi hour that is a perfect example of the genre, and also happens to be the most-watched program Amazon has aired. Additionally, there is Catastrophe, which is exactly the kind of Zeitgeist-friendly show that gets people talking and brings in tons of viewers simply from fabulous word of mouth.

Man in the High CastleAmazon Studios

However, that’s just four shows, five when you throw in the entertaining dramedy Mozart in the Jungle. There are more, of course, like the ‘80s throwback sitcom Red Oaks and the underwhelming Ron Perlman drama Hand of God, but few that have made an impact on adult viewers. Amazon has a high number of kids’ programming that is very successful, but less for a more mature audience. This is why Netflix doesn’t yet feel too much pressure, which is not to say it shouldn’t. Or won’t, sooner rather than later.

Why? Because, as noted above, with so much money to spend and an agenda to achieve, Amazon has the larger service in its sites and has every intention of making serious gains on it in the next couple years, if not outright overtaking it.

When I say larger service, by the way, I’m talking specifically about quantity of content, not the size of the company itself, because in that area — and, truly, in every area other than the amount of streaming content offered — Amazon is a much, much larger operation than Netflix. The company’s market cap, or overall worth, is just shy of $348 billion, roughly seven times Netflix’s number, and the stock price is right around $780 per share, as opposed to the roughly $125 per share of Netlfix. It’s partly for that reason, in fact, that it’s a little bit difficult to determine what kind of revenue Amazon Studios actually produces, because it is buried within the financials of the much larger corporation. The company’s third quarter was a very successful one, with net sales, operating income and net income all rising sharply over the same period the year before.

The same can be said of the amount of content coming out of Amazon Studios, but not what it all costs. One way to look at it is that it’s a method to get people to sign up for Amazon Prime (an annual subscription averages about $100, which comes out to about $20 per year less than what Netflix costs, and brings in billions of dollars of revenues all on its own), and thus is worth whatever it costs. In fact, it’s sort of like the way The CW works, in that the companies that own it (CBS and Warner Bros.) make more money by selling the second-run rights of their shows than they lose on the network itself. Ratings don’t really matter to The CW, and whatever money lost by the entertainment unit of Amazon probably doesn’t either.

Mozart in the JungleAmazon Studios

Netflix has a similar business model, in that it spends just about all of its revenue on new programming so as to draw more viewers, until it has enough subscribers to finally make money. Amazon already has tens of millions of customers and, indeed, has more Prime subscribers than Netflix has, but fewer of those Prime subscribers actually utilize the streaming service and sample the programming than do Netflix’s fare. The reason why is simple: someone signs up for Netflix solely for the purpose of streaming its content, while there are numerous reasons to sign up for Amazon, including that whole free two-day shipping thing. But thanks to that, Amazon actually has more money to spend on its content than its competitor, and it’s stepped up its development and production accordingly.

For instance, while the model the company has chosen to pick its shows involves showing its pilots to its subscribers and letting them vote on the projects — aka “Pilot Season” — some shows have bypassed that system, like the aforementioned Catastrophe, as well as Woody Allen’s first ever venture into television Crisis in Six Scenes, the British dark comedy Fleabag, and, just released last week, the David E. Kelley show Goliath, starring Billy Bob Thornton. Likewise, there are other shows that are not yet on the air which also earned that kind of respect, like the ongoing Jack Ryan series from Carlton Cuse and starring John Krasinski, the Gale Anne Hurd horror anthology Lore, and another anthology, this one a drama, from Mad Men creator Matthew Weiner.

But mostly, shows are chosen through that system, and it’s exactly that system which gave us Tig Notaro’s One Mississippi, the adaptation of the novel Z: The Beginning of Everything, and several shows green lit this summer, including an adaptation of F. Scott Fitzgerald’s unfinished The Last Tycoon, a new live-action version of The Tick, the Jean-Claude Van Damme-led Jean-Claude Van Johnson and the Kevin Bacon-led I Love Dick, from Transparent creator Jill Soloway.

That’s just scratching the surface, of course, because there are many more projects where those came from, including a a drama from Oscar winner Stephen Gaghan, an ongoing series adaptation of Tom Wolfe’s Bonfire of the Vanities, a dramedy from Margaret Cho, an ongoing adaptation of the 2007 Best Picture winner The Departed, a comedy from Josh Schwartz and Josh Gad called Toy Wars, Vatican City from The Good Wife creators Robert and Michelle King, and another drama from the works of Michael Connelly, this one an adaptation of his bestseller The Poet. That’s a whole lot of talent working to get their content on the service, talent that costs a whole lot of money to wrangle.

One MississippiAmazon Studios

The tricky thing now is to get more consistency out of the programming that actually makes it to series. Red Oaks was greeted with a mild response, has its second season premiering the end of this week, but it’s not like the anticipation is overwhelmingly high for it. Likewise, Hand of God‘s second season premieres soon, a season that will be its last. The newest show isn’t necessarily doing any better, as the period, based-on-real-events drama Good Girls Revolt has been met with a solid, if not totally winning, response. Goliath looks promising, but it just hit the site within the last week or so.

Just like Netflix does, Amazon also offers plenty of documentary and unscripted fare, like the upcoming The Grand Tour, starring former Top Gear hosts Jeremy Clarkson, Richard Hammond and James May, in which each episode is hosted in a different country. Three seasons have already been ordered, which means it will air at least through 2018. There are others, obviously, like a docuseries following tennis star Novak Djokovic, to go along with the kids’ programming, but the high profile focus remains on more adult, scripted fare.

Amazon Studios chief Roy Price has talked about the difference between the shows that have to go through Pilot Season and the ones that don’t, though he has been vague about what makes a show good for one process over another. Sometimes it helps to have the viewers weigh in, sometimes it’s his decision, something he has referred to as giving himself options. Since Amazon doesn’t reveal viewing numbers (just like Netflix), all viewers can really do is speculate about whether or not their preferred shows are going to return. When there aren’t that many shows from which to choose, it’s hard to spend too much time or become too devoted to the service. Not every show that Netflix puts out is solid gold, of course, but it casts its net so wide, there’s pretty much something for everyone. Price and his team have a lot to work with, but until they get to that level of quantity, with that many shows on the air appealing to that many different demographics, they need to be better about what they do put on the air and what they don’t.

The fact that they’re developing as much as they are, that they’re ordering as many scripts and green lighting as many pilots (if not actual series) as they are, is a step in the right direction and will eventually, in theory, put them right up where they want to be. But there’s still a fair amount of work to be done to get there.

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ProfilePic adjusted 2 is a filmmaker and journalist who has spent close to two decades working in and writing about Hollywood. Feel free to send him a tweet at @neilturitz. He’ll more than likely respond.

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