Amazon drops Apple TV and Chromecast: report

ITEM [via Bloomberg]: has notified its marketplace sellers that it will stop selling Apple TV and Google’s Chromecast. No new listings for either of them will be allowed, and posting of existing inventory will be removed on October 29.

The official reason: Apple and Google’s media streaming devices do not "interact well" with Amazon’s Prime Video.

Amazon will continue to sell Xbox, PlayStation and Roku devices because they support Prime Video. Amazon said in the email that it will stop selling incompatible media players “in order to avoid customer confusion.”

Unsurprisingly, the decision to drop Apple TV and Chromecast has drawn sharp criticism, Bloomberg reports:

Amazon’s decision to limit selection "sends the wrong signal to consumers," and the company’s explanation that Prime Video doesn’t work well with its rivals’ products is "especially weak," said Michael Pachter, an analyst at Wedbush Securities in Los Angeles.

"Fewer than 20 percent of Amazon customers are Prime members," Pachter said. "What about the 80 percent who want an Apple TV to stream Netflix? I think that the excuse of avoiding customer confusion is a not-so-veiled attempt to favor Amazon first-party products over third-party products, and think it was a bad move."

Napier Lopez at TheNextWeb argues that “customer confusion” is a weak argument, since Amazon could clear up that confusion with a warning on product listings that a given device won’t work with Prime Video.

It’s also a worrisome decision, he says, because up to now, Amazon has kept its retail and hardware divisions reasonably separate:

Actually halting sales is a shady business move, particularly considering new Apple TV and Chromecast models were just announced in the past month, and that Apple and Google are Amazon’s biggest hardware competitors. Of course, you can buy those products elsewhere, but that means losing Prime membership benefits, and will likely make many customers consider other streaming products instead (which is no doubt what Amazon wants).

Moreover, it sets a worrisome precedent; it’s the first time we can tell Amazon has stopped sales of a popular product simply because it didn’t like it (other than confederate flags, of course). Who knows what will happen next time Amazon has a problem with a competing device.

Meanwhile, streaming media analyst Dan Rayburn has told Wired out that Amazon’s logic isn’t even that consistent:

“If you’re trying to remove confusion about Prime streaming, why didn’t you remove that confusion six months ago or a year ago?” asks Rayburn. “If you’re going to do that, why aren’t you removing TVs from your marketplace that don’t support Prime streaming? Why aren’t you removing tablets from your marketplace that don’t support Prime streaming? There’s a lot of other things they could be removing.”

They’re not, though. Instead, they’re removing a dongle and a set-top box that, despite being well over two years old, sell nearly as well as Amazon’s brand new, correlative products on Amazon’s own site. And they’re doing so right after the latest versions of that dongle and set-top box have been released.

This kind of thing is probably inevitable when you have companies in both the hardware and content business. And Amazon may have another good reason for the decision that it's just not telling us. But “customer confusion” can’t be it, can it? The only confusion customers have probably been experiencing is why they can’t just simply buy the media player they want and watch whatever they want on it.