So make a playback app. If VUDU makes an ATV app it'll be the same thing
Amazon can just make a playback app like they do on the iOS App Store. Do they face this "sell at a loss or artificially increase your pricing" dilemma on the iOS App Store?
iPhone and Apple TV are not the same thing.
For one the iPhone owns a nice chunk of the mobile userbase. Not being available on iPhone at all is obviously problematic from a business point of view. But while iOS devices may get a significant number of eyes in the portable market, what we're talking about here is the 10' UI market - devices that are utilized on a TV. The broader market consists of 'smart' TV's, BD players, consoles, specialty devices like TiVo, and dedicated settop box / stick ''streaming' devices. Amazon does have pretty wide exposure here, with apps on at least some devices in all of those segments. And for currently released devices, it has exposure on a large number. Even if you narrow the market for 10' UI devices to strictly be where Apple has an offering, ie. settop box / stick ''streaming' devices, Apple doesn't own the category. That would be Roku, and even Fire OS devices are doing reasonably well versus Apple currently. So strictly from an eyeballs perspective in the overall segment, there simply isn't the same business need.
The bigger point though is the actual differences in expectations between the mobile and 10' UI categories. A majority of video rentals and purchases are made from devices hooked up to a monitor or TV ... not a phone. And that's where the main sticking point is with the 30% charge. While a number of companies may feel compelled to have video 'playback only' apps available for mobile, how many such apps do we see on 10' UI devices (obviously discounting sub-only offerings)? There are simply different expectations on functionality and feature-set between the two. And offering an app that doesn't meet those expectations can actually be worse than not being there at all. You break discoverability for the capabilities of your service if you don't have features on the platforms they are expected on.
Here's a simple real world illustration. Apple is offering 'universal' search as part of their API. Now let's say Amazon were to offer a playback-only app. What happens when someone does a Siri search for a movie that is available for rental / purchase on Amazon but isn't on Prime? Does it simple not show up on that cool placard of what apps have the video available and how much it costs? Or does it instead actually show up there with the price, but when you click it to make the purchase you instead go to a screen that says 'This movie is unavailable for purchase through this device, please log onto Amazon.com to purchase this item'?
Both of those options suck for the users and for Amazon or any similar video services company. The first one kills discoverability which obviously harms users' knowledge of what the service offers. That's a business no-no. The second is simply a bad user experience, which obviously harms peoples' general view of the usefulness of said service. People are lazy. Unless there's a substantial savings, people are going to choose the path of least resistance which is obviously the app where they can simply click and buy.
What I find most confusing though is the ire that's specifically directed at Amazon. Quite literally they should not offer rentals and purchases while giving up 30%, and I submit the above reasons why making a viewing-only app is not a good business decision, yet here we are singling out Amazon specifically. So far I don't see any of the non-sub video services lining up to hop on Apple TV. So why aren't they being similarly criticized? Is it simply because Amazon made their position public and stopped selling competitor's devices?
Let's say we get stricter and single out companies that have their own app store and sell video rentals / purchases. That seems to be a common rationale cited for Amazon's hesitance to make an app here. For whatever reason that particular reality is used as a rally point to criticize them more, instead of being seen as a reasonable business rationale, but I suppose that's neither here nor there. The point being Google finds themselves in that exact same position, yet there doesn't seem to be the same outcry that they aren't offering up an app on Apple TV. Is it because of Amazon's popularity? If anything, doesn't that mean they're logically in an even better position to dictate terms?
Of course then there's Apple themselves. They literally do not offer their video service on basically anything that isn't an Apple product. They scoff at the idea of paying some other store a fee to access their content ... all while at the same time demanding the highest fee to put apps on their own store (not to mention charging what's likely the highest margin for their own device that does have access). I don't know if it's some sort of expectation born out of iOS's popularity, where Apple basically gets what Apple wants in terms of app offerings, but the hypocrisy in all of this is hilarious. Apple TV is not iOS, sorry, and the fact that Amazon is being singled out in this situation is laughable.
I just want to play my amazon media on the apple tv. They need to stop acting like babies over there.
Hey, I'd love for all services to be everywhere ... that would be the best for consumers. But to pretend they're being 'babies' instead of considering the very real business reasons behind this stuff is silly. If anyone is being a baby, it's the people whining and ridiculously oversimplifying the situation.
Apple has made crazy amounts of money due their margins, both from their own services and devices, and by the fees they make from others to put apps and services on their products. Of course demanding such high fees isn't going to always work out for them, particularly when it's in a market they aren't coming from a true position of strength.
From Apple's point of view lowering their fees now to get everyone on board, only to raise those fees later once they are in a position of power would be pretty problematic. So as a business one can argue it makes sense to do what they're doing; hope the device reaches sufficient numbers to improve their negotiating position later on. Of course the corollary is also true for Amazon. Apple is currently not in a position of strength here, so there's no reason make a bad business move by hoping on right now. Certainly not without a much better fees contract.