Amazon.com, Inc. (NASDAQ: AMZN) is developing a brand-new show with former "Top Gear" hosts Jeremy Clarkson, Richard Hammond and James May.
This could be Amazon's first step toward producing a greater variety of high-end content, but it might serve another purpose.
"It's really clever," Rich Tullo, director of research at Albert Fried & Company, told Benzinga. "Really, what you do with it, the cross promotion, the cross selling, the target -- that's where you can make money off of that and turn it into a native advertising platform for Amazon's s***. If they do direct purchases -- [if] these guys come out with new wheels; they're nice, they're shiny, and how good they look on this car? Do you own it too? You can click here, buy it, $2,500 each. It could work."
Tullo also acknowledged the power this show could yield overseas.
"It tells me they're very serious about competing with Netflix in Europe," he said. "It's a tentpole. [It's as if Amazon is saying], 'Your business may be a little bit better than our business in the UK, but we're gonna fight because it's even market share."
Tullo estimated that Amazon will pay as much as $75 million per year for this new, unnamed show. He said this content will be "really important" in the UK and that the deal will make sense if it adds five to 10 million subscribers to Amazon Prime.
"I don't think it makes sense from a programming basis, but it was a good business decision [because they sell auto parts]," said Tullo, adding that viewer data will tell Amazon which consumers should be targeted.
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'Getting The Band Back Together'
Rentrak Corporation (NASDAQ: RENT) Senior Media Analyst Paul Dergarabedian told Benzinga that the new show is like "getting the band back together."
"I think a lot of the fans were really saddened at the seemingly sudden disbanding of that trio of presenters, who were the real heart and soul of 'Top Gear,'" said Dergarabedian. "It's all about chemistry and those three guys together were what made that show."
Dergarabedian said that when Amazon attracts a "big ticket item" like "Top Gear" and essentially shifts its hosts to another platform, it's a big win for the company.
"What they're now able to do is attract people to their platform," he added. "They attract you to their platform and then they want you to stay there and keep searching around and discover other content. It brings a whole new audience to Amazon and it does up the ante for them."
Dergarabedian also had some words for anyone that doubts the success of this venture.