When Amazon sneezes, publishers catch a cold.
Costing around $500,000 to produce, making it the most expensive TV show ever, the Lord of the Rings as reinvented for TV by Amazon as “Lord of the Rings: Rings of Power”, saw only 37% of Americans complete the series, and only 45% globally.
It will be a major blow to the company, now struggling to keep investors happy amid hard economic times, to know that such a huge sum of money failed to do its most important job – keep consumers happy.
To make matters worse, 71% of viewers were over 35, which will pain Andy Jassy, but is also something publishers might want to consider, as the age differential may be a cautionary tale for publisher expectations.
Of course, these are exactly the kind of invaluable consumer insights a la carte book sales, print or digital, cannot offer publishers, and one of any reasons why publishers need to rethink their position on books streaming.
Business Insider‘s rehash of The Hollywood Reporter article quotes Amazon Studios sources as saying that Amazon Studios is a “confusing and frustrating place to do business,” with one showrunner telling THR that “there’s no vision for what an Amazon Prime show is.”
Business Insider itself says unnamed Amazon executives and other entertainment industry stakeholders have said that Amazon Studios faced challenges with unclear creative direction, leadership shifts, and tech bureaucracy that threatened to drive away staff and Hollywood creative talent.
All of which matters for publishers at several levels.
Amazon is less likely now to invest in new video based on perceived success of books, with the knock on effect that the TV series will drive fewer book sales.
More importantly, at a time when Amazon is shedding jobs by the bucket-load and cutting costs at every turn, Prime Video, which offers very little direct financial return for the company, is inevitably going to face further restraints on spending, in a downward spiral that could feasibly see the whole Amazon Studios project go the way of so many other Amazon ambitions that ultimately proved not to deliver the expected returns.
But before that happens, given the high profile nature of Amazon Studios and Prime Video, we’ll likely see even more cost-cutting across the books and publishing sector of Amazon, as previously explored at TNPS.
For publishers and consumers alike, its going to be a bumpy ride as Amazon adjusts to new market realities.
The biggest reality for publishers being that, however much they may loathe to admit it, Amazon is central to their existence.
When Amazon sneezes, publishers catch a cold.
There will be much more sneezing to come.
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