Netflix announces DreamWorks deal, and Amazon fires right back with Fox

There was quite a commotion in the streaming video space yesterday, as both Netflix and Amazon announced new deals. In the case of Amazon, this makes it seem even more likely that they're set to announce their "Kindle Fire" (the name according to the latest leaks) tablet on Wednesday, but there's still nothing official on that count. I guess we'll know tomorrow.

In the meanwhile Netflix (which lets face it, has been having a bad month overall) shared the news that they've outbid HBO for content from DreamWorks Animation. According to the New York Times, Netflix is paying $30 million per movie, though how much time that figure covers isn't specified. This is a big deal because it's the first time Netflix has snagged content away from a major TV player like HBO.

So that's the good news for Netflix and its customers. The bad news is that the deal doesn't kick in until 2013. Considering that Starz licensing expires in February 2012, Netflix customers will have a long wait for replacement content (and anyway, as lovely as DreamWorks Animation titles are, they aren't a replacement for the variety of content that Starz provides). So while this seems like a good step for Netflix, it certainly isn't a solution to all the company's problems.

And those problems got a little worse yesterday when Amazon made it's announcement: content from FOX is coming to Amazon Prime. Amazon says this brings the total to more than 11,000 movies and TV shows available via Amazon Prime. Netflix still has a lot more (over 50,000 pieces of content) but for many hardcore Amazon customers Prime Video is essentially free. Prime started as a $79/year service that offered free 2-day shipping on orders from Amazon, and for heavy Amazon users the service paid for itself when it was just about free shipping. The addition of Prime Video is just a bonus for those customers.

Titles included in the FOX deal include The Wonder Years (the first time the title has been offered via streaming) as well as the usual FOX suspects: 24, The X-Files and Buffy The Vampire Slayer. The timing of this deal couldn't be better; people quitting Netflix due to their recent hikes could be looking for alternative sources, and even if you don't use the free shipping perk, $79/year for Amazon Prime is cheaper than Netflix Streaming ($7.99/month or $95.88/year).

Another interesting Amazon Prime rumor: Electronista ran a post over the weekend about evidence suggesting that Amazon might roll out some kind of e-book rental system as part of Prime, too. This is presumably something different from the library lending system that we looked at last week.

All in all, I think Amazon came out on top for this week. Netflix's DreamWorks deal is a long-term thing and they need something to entice back disgruntled customers today, not in 2013. In the meantime, we're all waiting to see the official reveal of the Kindle Fire tomorrow. Ryan Block at Gdgt says we'll be seeing what's essentially a RIM Playbook running Android. His sources don't have kind things to say about it, sadly enough.

Read more of Peter Smith's TechnoFile blog and follow the latest IT news at ITworld. Follow Peter on Twitter at @pasmith. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.

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