Amazon.com, Inc. (NASDAQ:AMZN) is in talks with big media companies about licensing channels for their own online pay TV service, according to sources with The Wall Street Journal. These talks are in early stages and it is uncertain about when it will move forward.
This service does not have a business model as of yet either. Amazon would need to license their channels for competitive rates. The media companies would likely only agree to a partnership if they could offer the entire bundle of channels that satellite and cable companies sell.
There are seven companies that account for 83% of primetime TV viewing for 18-49 year olds. These companies depend on fees from cable, satellite, and telecommunication video distributors.
Amazon sells and rents movies and TV shows along with a few original shows on-demand through the Amazon Prime Instant Video service that is available for customers that pay $79 per year. Amazon is rumored to be developing a device to bring Internet video to television like a Chromecast or Roku device.
In related news, Verizon announced today that they would be acquiring Intel’s streaming TV service called OnCue.