Amazon has aggressively grown its Prime Instant Videos service over the past year, more than tripling the amount of content available to subscribers since launch. And as Amazon continues to add more content to Prime Instant Video, there have been speculations that it could introduce a service not tied to its Amazon Prime offering. But that’s probably not in the cards — at least not in the near term — according to the company’s top video content acquisition exec.

Today, access to its streaming video service comes bundled with Amazon Prime. But some rumors have emerged lately, suggesting that Amazon could unbundle the service and offer it as a standalone competitor to Netflix or Hulu Plus. That includes a mention from Netflix CEO Reed Hastings, who wrote in a letter to shareholders that he expects Amazon to introduce the service and price it below Netflix’s own offering.

But Brad Beale, Head of Digital Video Content Acquisition at Amazon, said in an interview Wednesday that the company is unlikely to break out the video subscription offering anytime soon. “The bundle of benefits that come with Amazon Prime make perfect sense to offer to customers,” Beale said. “The way that Prime Instant Video is offered today — we’re going to continue that approach at least into the near future.”

Even before adding the video component, Beale said that Prime was an incredible value. The offering provides free, two-day shipping to customers who pay an annual subscription. We’ve believed for a while that adding video could entice some customers to sign up for Amazon Prime who might otherwise not have — and once they’ve paid the annual subscription fee, they’re likely to take advantage of the free shipping. In that sense, video could be seen as a loss leader for driving more physical retail sales.

There’s also the fact that having a free subscription service could help boost transactional sales through Amazon’s VOD and electronic sell-through offering. While Prime Instant Video has 15,000 titles for free viewing, it doesn’t have many of the latest new release films or in-season TV episodes. For newer content, Amazon offers more than 100,000 titles for rental or purchase. So an Amazon user who got hooked on older seasons of Downton Abbey or Sons of Anarchy on the free service might convert to being a paid user to watch the current seasons of those shows.

As Amazon adds content, it’s also looking to boost awareness of what’s available on the service. That includes placement of a letter from Amazon CEO Jeff Bezos on the site’s homepage, letting the millions of users who stop by every day know what new content is available from Amazon Prime. That kind of promotion is driving awareness and usage, Beale told me. As more customers learn what’s available, and as Amazon continues to improve the offering with even more content, he expects customer adoption to grow even more.

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Well, I don’t think it’s a stretch anymore to say that Comcast’s latest venture into online video is a off to a good start. CBS is the latest network to join the impressive lineup which also includes HBO and Cinemax as of yesterday. This networks is a big step for Comcast On Demand Online as CBS is the only major network not available on the free to everyone site, Hulu. But remember, Comcast On Demand Online will only be available to Comcast subs who currently pay for the stations. (e.g. if you can’t watch HBO on your TV, you can’t watch it online)

Comcast will open the service to 5,000 beta testers in the coming weeks. I’m just curious about how many more networks will sign up before it launches to everyone. The service already has the most of any online viewing site available with, all the major networks, HBO, Cinemax, Stars, TBS, TNT, and most of the cable stations.

CBS TO PARTICIPATE IN COMCAST’S ON DEMAND ONLINE
NATIONWIDE TRIAL

As the First Broadcaster To Participate, CBS Agrees to Test Standards and Principles for

“TV Everywhere” Model

NEW YORK and PHILADELPHIA, July 14, 2009 — CBS Corporation (NYSE:  CBS.A) and Comcast Corporation (Nasdaq:  CMCSA, CMCSK) announced today that CBS is the first broadcast network to participate in Comcast’s technical trial of On Demand Online.  The new service will significantly expand the number of top-rated TV shows available online and across platforms at no additional charge to Comcast’s cable customers while delivering increased advertising value to content owners.  During the course of the trial, CBS plans to test various types of current and library content.

“CBS and Comcast share the same vision of giving consumers more — more content, in more places,” said Matt Bond, Executive Vice President of Content Acquisition, Comcast Cable.  “On Demand Online is a major step in extending consumers’ television experiences online, and ultimately across platforms by giving any television network, including top brands like CBS, the ability to make their content available on the Web.”

“CBS is very supportive of initiatives that help extend our content to new platforms in such a way that we gain new audiences and additional value for our advertisers,” said Quincy Smith, Chief Executive Officer, CBS Interactive. “Comcast is already a trusted platform to distribute CBS content on air as well as on demand; expanding this relationship online is a logical step.  In addition, CBS’s strategy has always been about open, non-exclusive distribution of our content in a consumer friendly way, which is a core tenant of TV Everywhere and On Demand Online.”

CBS’s participation in Comcast’s technical trial comes on the heels of last month’s joint announcement between Time Warner Inc. and Comcast which introduced a set of principles called “TV Everywhere.”  Developed by the two companies, the principles are designed to serve as a framework to facilitate deployment of online television content in a way that is consumer friendly and pro-competitive.

Comcast will begin its technical trial of On Demand Online with approximately 5,000 customers from across the U.S. in the coming weeks – the first national trial of its kind.  A major focus of the trial is to test Comcast’s new “authentication” technology, which will allow Comcast customers to receive the same content online for free that they subscribe to on TV.  The service will utilize a simple log-on system for streaming content and, in the future, will allow for download content to go.  The On Demand Online service will roll-out in phases, adding new features, functionality and content over time to provide consumers with a new way to watch television.

On Demand Online is part of Comcast’s Project Infinity, the company’s long-term vision to give customers an ever growing amount of video content on multiple platforms, whenever they want.