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Amazon Channels ‘Scaling Back Ambition’ to Expand Selection: Report

Amazon executives have began telling entertainment companies that they’re going to be more selective moving forward in regard to what video services to include in the popular Amazon Channels a la carte service, according to The Information.

Amazon Channels is a component within the larger Amazon Prime Video ecosystem. It lets Prime users subscribe to more than 200 over-the-top video services—everything from HBO to Acorn TV—with billing to multiple platforms centralized and handled through Amazon.

Beyond indicating that the e-commerce giant may be more selective, The information report doesn’t seem to signal that Amazon is backing off its popular Channels marketplace. BMO Capital Markets estimates Channels generated $1.7 billion in revenue for Amazon last year, more than double what it generated in 2017.

Simultaneously, The Information reported that Apple is ramping up a similar OTT bundling model with an eye for an April launch. Meanwhile, Roku has begun to deploy a new feature within its AVOD platform, the Roku Channel, that lets users buy premium video services like Starz through Roku.

“We believe [Prime Video Channels] is a material driver of standalone [over-the-top] subscribers for many entertainment companies,” representing anywhere from 25%-45% of total OTT users depending on the channel, BMO analysts Daniel Salmon and William Lowden wrote in their December report.