Netflix Beware: CBS, Amazon Forge Streaming Deal (Updated)

2,000 episodes of shows including “The Tudors” available to Amazon Prime members at no extra cost

Last Updated: July 21, 2011 @ 1:41 PM

Competition for the streaming audience just got more intense, with CBS and Amazon.com announcing a deal Wednesday that will allow viewers to stream 2,000 episodes of 18 shows from the network's library. 

The deal comes on the heels of Netflix's controversial price hike and as Hulu lands on the auction block.

It substantially strengthens Amazon's streaming library, bringing the number of shows and movies available on its subscription service Prime to 8,000.

The 18 shows include "The Tudors," "Numb3rs," "Medium," "Cheers," and the entire "Star Trek" franchise, roughly the same offerings that CBS makes available through a pact it signed with Netflix last February. All will be available to Prime members at no extra cost.

Also read: Netflix's Streaming Dilemma: Too Fast, Too Cheap, Maybe Out of Control

Prime, a $79 annual service that offers customers unlimited two-day shipping, now offers customers instant access to more than 6,000 videos. The additional 2,000 episodes will be available this summer.

The CBS pact signals that Amazon intends to be a big competitor in the subscription streaming market — a space that has been dominated for the past two years by Netflix. For Netflix, the increased competition could be worrisome. Citing postage costs, Netflix hiked its prices on its most popular subscription package by 60 percent last week, leading to lots of outraged customers. 

Keeping costs down may get even more complicated if Amazon shows a willingness to throw money around. The online retailer has deeper pockets than Netflix, and could conceivably drive up the price tag for streaming content packages going forward. 

Adding further uncertainty to the streaming picture, Hulu is up for sale, and generating interest from the likes of Google, Microsoft, and even Amazon itself. 

Amazon's move into television content comes with some risks. For one thing, it might stoke the fears of the cable industry, who have historically viewed streaming services as a direct threat to paid television channels such as HBO. Should Amazon snap up even more television content, its relationships with that part of the entertainment landscape could get more strained. 

Terms of the deal were not disclosed. However, if Netflix's past deals to carry television content are a benchmark, Amazon could be paying north of $200 million a year to stream CBS' catalogue. 

"Our new deal with CBS makes Amazon Prime even better for customers," Amazon CEO Jeff Bezos said in a statement. "We're excited to add thousands of popular CBS programs to our already great selection, all of which stream at no additional cost to Amazon Prime members."