Amazon's video-streaming service might be more popular than Netflix.
The research firm Consumer Intelligence Research Partners (CIRP) just released a study showing that people stream video content on Amazon as much as (or more than) on Netflix, thanks to Amazon's decision to offer both a subscription and single-pay service in the same place.
Amazon's magic is that people who subscribe to Prime — the company's $99-a-year service that comes with two-day free shipping and the ability to stream thousands of free movies and TV shows — will also buy movies and shows from Amazon that are not listed as free.
Here are the key numbers from CIRP:
Netflix members view video 12.7 times per month, iTunes users buy or rent video 4.9 times per month, and Amazon Prime members view free Prime video 8.3 times per month.
If Amazon offered only its subscription service, Netflix would still be the king of streaming video content.
But it doesn't. If you factor in CIRP's finding that Prime users also buy or rent content from Amazon Instant Video 5.1 times per month, Prime members view video on Amazon 13.4 times per month — more than Netflix.
"Amazon doesn't do anything the way anyone else does it," Mike Levin, CIRP's cofounder, told Business Insider. That's what makes its system so clever.
"Amazon Prime customers use the free streaming video that they receive with their membership somewhat less than Netflix members use their service," Levin writes in the report. "But, Amazon Prime customers also buy or rent additional video using Amazon Instant Video, say when a video is not available on the Prime streaming service. We combine the Amazon Prime streaming and Amazon Instant Video use to conclude that Amazon Prime members use video from Amazon about as often as Netflix subscribers use video from their service."
Amazon has poured a bunch of money into Prime Instant Video — $1.3 billion in fact — to try to make Prime more attractive. Prime members are believed to spend more than double what nonmembers do on the site.
Now there's some indication it might actually be paying off.
For what it's worth, this is not a winner-take-all situation. Plenty of people will subscribe to both Amazon and Netflix. But Amazon's success in a relatively short period of time is something everyone in the TV/video industry should be watching.
(CIRP based its analysis on a survey of 500 Americans who use on-demand video.)
Disclosure: Mathias Döpfner, CEO of Business Insider's parent company, Axel Springer, is a Netflix board member.
