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Low cost computer, free software updates, backend infrastructure, several years of functional life, for $40 in sales (is there any profit there?). Exactly how i

Low cost computer, free software updates, backend infrastructure, several years of functional life, for $40 in sales (is there any profit there?). Exactly how is it surprising that they need to make some sort of additional revenue via kickback?

HWR_14 3y ago
The specs are seem roughly equivalent to a raspberry pi, which is produced with far less economies of scale, and sold for a similar price point.
- bdcravens 3y ago
  The Pi is sold without peripherals (remote) at that price point, they build little of the software, and given the supply/demand of late, there's a good argument to be made that it's well underpriced. When I had DirecTV Stream, I bought their streaming device (basically an Android steaming device, but they made it super simple to go into programming, feeling more like traditional cable). They cost $120 each.
  - deleted 3y ago
    [deleted]
mdasen 3y ago
The thing I'd point out is that if you're taking 30% of revenue from 4 streaming services, you're getting more revenue than if you operated a streaming service. I agree that these boxes/sticks need some recurring revenue (120% of the revenue of the streaming services). However, should they receive more revenue than the services themselves? If they're taking 30% from Netflix, 30% from Max, 30% from Disney, and 30% from Paramount, they're getting over $16/mo. Should it be $16/mo per user? The problem isn't that they need revenue. It's that the revenue demands seem very high compared to the costs of maintaining those boxes. They aren't looking for $10/year to cover their costs and make some profit. They're looking to get more revenue than those actually creating the content.
paxys 3y ago
They already get plenty of kickbacks: - Service providers paying them to have their buttons on the remote. - % cut for movies & TV shows that users purchase on the device. - % cut for subscriptions/IAPs from all the installed apps. - Directly driving subscriptions for Prime Video. - First party ads all over the interface. - Selling and monetizing viewership data. Of course none of this is enough, and so the company must continue to squeeze the ecosystem to placate shareholders.
hamandcheese 3y ago
You are right, it is entirely unsurprising that the monopolist expects to see a positive ROI on their dumping scheme.
the8472 3y ago
> free software updates It's not like amazon is paying for the maintenance of the entire software stack. And the part they're doing they mostly have to do anyway to support new devices.
- bdcravens 3y ago
  Which underpins the point, that Amazon is continuing development of new software and hardware even with such low/no profit.

HWR_14 3y ago

The specs are seem roughly equivalent to a raspberry pi, which is produced with far less economies of scale, and sold for a similar price point.

bdcravens 3y ago
The Pi is sold without peripherals (remote) at that price point, they build little of the software, and given the supply/demand of late, there's a good argument to be made that it's well underpriced. When I had DirecTV Stream, I bought their streaming device (basically an Android steaming device, but they made it super simple to go into programming, feeling more like traditional cable). They cost $120 each.
- deleted 3y ago
  [deleted]

mdasen 3y ago

The thing I'd point out is that if you're taking 30% of revenue from 4 streaming services, you're getting more revenue than if you operated a streaming service. I agree that these boxes/sticks need some recurring revenue (120% of the revenue of the streaming services). However, should they receive more revenue than the services themselves? If they're taking 30% from Netflix, 30% from Max, 30% from Disney, and 30% from Paramount, they're getting over $16/mo. Should it be $16/mo per user? The problem isn't that they need revenue. It's that the revenue demands seem very high compared to the costs of maintaining those boxes. They aren't looking for $10/year to cover their costs and make some profit. They're looking to get more revenue than those actually creating the content.

paxys 3y ago

They already get plenty of kickbacks: - Service providers paying them to have their buttons on the remote. - % cut for movies & TV shows that users purchase on the device. - % cut for subscriptions/IAPs from all the installed apps. - Directly driving subscriptions for Prime Video. - First party ads all over the interface. - Selling and monetizing viewership data. Of course none of this is enough, and so the company must continue to squeeze the ecosystem to placate shareholders.

hamandcheese 3y ago

You are right, it is entirely unsurprising that the monopolist expects to see a positive ROI on their dumping scheme.

the8472 3y ago

> free software updates It's not like amazon is paying for the maintenance of the entire software stack. And the part they're doing they mostly have to do anyway to support new devices.

bdcravens 3y ago
Which underpins the point, that Amazon is continuing development of new software and hardware even with such low/no profit.