updated 07:20 pm EST, Tue February 7, 2012
Amazon and Viacom expected to tie up
The mystery Viacom video deal was attached to Amazon Tuesday in a leak Tuesday. While the terms of the deal weren't known to Reuters, it would be part of a rumored plan to offer Internet subscription video as an option separate from a Prime deal. As hinted by Viacom CEO Philippe Dauman, the deal could be made public as soon as this week, although whether or not that would include the new Amazon service wasn't mentioned.
The addition would be to bulk up Amazon's content enough to provide a substantial challenge to Netflix. The predecessor service has a much larger established catalog and would likely prompt Amazon to fill its library with as much as it can get before it goes separate. Studios have purportedly exerted pressure as they aren't happy having their content tied to the $79 yearly Prime account and possibly devaluing their movies and TV shows.
Disney, Fox, NBC, and Sony are all now supplying Amazon with video. Most recent content from the studios has been kept off to protect existing DVD and pay-to-own downloads from iTunes and alternatives. Narrowing the gap could help sell devices like the Kindle Fire, where video is the centerpiece.