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Amazon CFO: Prime Video Having 'Great' Results

26 Oct, 2017 By: Erik Gruenwedel

Despite recent management changes at Amazon Studios, including the departure of studio head Roy Price following sexual-harassment allegations, the e-commerce giant remains bullish on the video business, CFO Brian Olsavsky said on the company's Oct. 26 fiscal call.

With Amazon Studios reportedly spending $4.5 billion on content in 2017, Olsavsky said the company would increase spending going forward as video (and music) continues to resonate with consumers and drive traction across the company.

“Why are we going to do that? Because the video business is having great results with our Prime customers,” he said. “[Video] continues to drive better conversion of free trials, higher Prime membership renewal rates and higher overall engagement,” he said.

The CFO said Prime Video users spend more on Amazon than non-video consumers.

“We have a lot of data … that we see the viewing patterns and we see the sales patterns. So, we tie the two together and understand which video resonates with Prime members, which video doesn’t and make mid-course corrections,” Olsavsky said.

He said the studio is looking for “more impactful” shows that resonate with its customer base. 

In the quarter, Amazon Studios closed deals with “The Walking Dead” creator Robert Kirkman and “Gilmore Girls” creators Amy Sherman-Palladino and Daniel Palladino, and greenlit a comedy series starring Fred Armisen and Maya Rudolph, as well as the drama series “Tong Wars,” from Paul Attanasio and Wong Kar-wai.

The studio also announced development on Underground Railroad with Barry Jenkins; The Boys with Seth Rogen and Evan Goldberg; Snow Crash from the novel by Neal Stephenson; Lazarus, based on a comic book by Greg Rucka; and Ringworld, based on Larry Niven’s sci-fi book series.

Separately, Amazon said NFL Thursday Night Football on Prime Video saw a total of 7.1 million views in the first four games. Prime members in 187 countries and territories have streamed games on living room devices, including smart TVs and Fire TVs, as well as the Prime Video mobile app and the Web, with each viewer watching an average of 51 minutes.

Finally, Amazon, which saw Q3 North American revenue skyrocket 35% to $25.4 billion, with international up 29% to $13.7 billion, disclosed that Hulu selected Amazon Web Services as its cloud-based provider.

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