New Priorities led to Amazon and Apple’s new Partnerships, but the Peace won’t Last Forever

featured image

LONDON – Apple and Amazon have taken a more collaborative approach recently, announcing a number of deals since late 2017. However, this does not amount to a full-blown, long-term partnership between the two. That’s according to a new report published by UK-based media analysis firm, Enders Analysis, released Thursday.

New Priorities

One of the paper’s authors, Matti Littunen, told TMO that the two firms had dialed down the animosity in recent times because their “priorities have changed”. He added: “Some of the areas where they were fierce competitors have either become less important to the companies or they’ve been willing to let those areas of their business take a backseat and focus on what really matters.”

Mr. Littunen said the warmer relationship in some areas means Amazon can focus on beating Google in the connected home arena. He added that the tie-ups mean Amazon could also focus on “improving the reach of prime video, and therefore the prime subscription in general, in Apple households.”  He also thinks that “there will be more and more of these sorts of integrations,” which will continue “as Apple expand their content offerings in media.”

While there has been much talk of iPhone sales numbers recently, Mr. Littunen said that Apple had also realized that products like the Apple TV and HomePod “will remain sub-scale.” This obviously has a negative impact on services growth in areas connected with those products too. Consequently, Apple realized it was going to have reduce the barriers to those services, and put them on other devices and platform. This became clearer at CES 2019 when a number of firms announced integration with Airplay 2 and HomeKit.

A Pause, Not an End, to Hostilities

It is easy to get ahead of ourselves in conversations like this. Services remain a very small part of Apple’s overall revenue. Furthermore, just because there has been a detente between Amazon and Apple in some areas, that doesn’t mean it covers everything. Mr. Littunen noted that the two companies remain fierce rivals in the e-books market, for instance.

The current peace in selected fields is certainly not permanent either.  “We could easily, in a couple of years time find ourselves back in a situation where they start making big competitive moves against each other again,” Mr. Littunen concluded.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.