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Worth it? Amazon Prime and Streaming Video Take on Netflix

Amazon has launched the first salvo in its long-anticipated battle against movie giant Netflix over supremacy in the streaming video market. It has added free video streaming capability to its Amazon Prime service.

Up until now, all Amazon Prime did was offer free two-day shipping and a reduced price for one-day shipping to its members. It costs $79 per year. But now the service will include free video streaming.

Called Amazon Prime Instant Video, it currently has 5,000 movies and TV shows that you can watch "instantly" on your computer or a media device connected to your television. That is a far cry from Netflix's 20,000 films available for streaming.

However, analysts say Amazon doesn't really want to compete with Netflix just yet -- this is all about making its Amazon Prime package better and more attractive to customers.

And points out: "Unlike Netflix, Amazon video isn’t limited to subscription streaming. Amazon Instant Video, its a-la-carte rental or pay service, claims more than 90,000 titles, including movies and TV shows. Some are available the same day as DVD release as an Instant option while you wait for the physical disc to ship; some TV shows are next day a la iTunes. This play is as much about selling those—maybe more—than it is about a subscription service right now."

Indeed, the $79 per year gets you free Amazon shipping on all items and the streaming service, which is cheaper than Netflix, which charges $7.99 per month (or 95.88 per year) for its streaming-only service. Netflix packages that allow receiving DVD's by mail start at $9.99 per month.

But if you want a wider selection and prefer to watch movies on DVD, then Amazon Prime is not for you, regardless of the savings. You'll have to tap into Amazon video's pay-for-content model as well.


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