This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Why Amazon's Fire TV Didn't Burn Netflix or Apple Investors: StockTwits

NEW YORK (TheStreet) -- Amazon (AMZN) unveiled Fire TV Wednesday, with the promise that the thin set-top box would revolutionize entertainment in the same way the Kindle changed reading habits. But investor excitement for the device, speculated about for weeks, was quickly extinguished.

$AMZN Fire TV announcement = market shrug. -- Anne (@abubnic) Apr. 2 at 01:13 PM

Amazon's stock climbed just a quarter of a percent by 2 p.m., nearly two hours after the company concluded its news conference. Some cashtaggers said the lack of enthusiasm was a bearish sign for the stock, which trades at $343.86 and is down nearly 14% since the start of 2014.

$AMZN On a day this should have rocketed this goes no where... Hello 330. -- Roses_Wilted (@Roses_Wilted) Apr. 2 at 12:58 PM

Fire TV reminds many of Apple's (AAPL) set top box. Like Apple TV, the device costs $99. It is available for order now on Amazon.com. Also like Apple TV, it displays photos on the television screen and streams Netflix (NFLX) and other subscription content in HD -- provided that users have a subscription.

Apple TV, of course, never really took off, despite rave reviews from owners. That's one reason why Amazon investors might be withholding oxygen from Fire TV.

Amazon insists its device is better than competing offerings. It has three times the processing power and four times the memory of Apple TV, Google (GOOG) Chromecast or Roku 3, according to Amazon's press release. Amazon promises that the extra power and memory will allow its content to start ASAP. Waiting for content to load has been a pain point for Netflix subscribers, although one that should be alleviated somewhat by Netflix's recent deal to pay Comcast (CMCSA) for a direct connection to the cable giant's broadband network.

At first blush, it doesn't appear that Amazon's set-top box is really battling Netflix, since it will play Netflix content for subscribers. Netflix shares fell a little less than 1% after the announcement -- far less than many investors had expected.

$AMZN So it appears this media event had no effect on either stock... what a non-event $nflx -- Kevin Ojunta (@darotweiler) Apr. 2 at 12:42 PM

The fact that Netflix fell at all is likely attributable to compatibility fears. Some investors are concerned that Amazon's box will work seamlessly with Amazon Prime, making that $99 service more attractive to owners than Netflix. Amazon's original series, available to Prime subscribers, and its deal to exclusively stream Fox's hit series 24 are already taking aim at Netflix's subscribers.

Apple's stock, for its part, showed no reaction to Amazon's blockbuster news. Shares were flat by 2 p.m.

Some investors say the set-top box market is over-saturated. Amazon's Fire TV not only has to compete with Apple TV, Chromecast and Roku, but also with smart televisions that have direct Internet connections and game consoles such as the Nintendo (NTDOY) Wii, Sony (SNE) PS3 and Microsoft's  (MSFT) xBox 360,which all play streaming video services on the TV.

$AMZN Poor Ouya is going to need to step it up. Still sticking with my Chromecast anyway. Over-saturated set top box add-on market for sure. -- Tim Phillips (@kayak83) Apr. 2 at 12:53 PM

One thing is certain. Investors don't think Amazon's Fire TV will ignite the set-top market anytime soon.

At the time of publication, the author held no positions in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7870 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs