Amazon Planning Set-Top Box to Deliver Internet Video to the TV

Amazon reportedly is planning to launch a set-top box that would more easily stream video from the Internet to the television, including Prime Instant Video, rental and digital purchases via Amazon Instant Video.

Bloomberg News, citing sources familiar with the situation, said the device (or possible upgrade to the Kindle Fire) would enable the e-commerce juggernaut to expand its physical and digital media distribution channels directly to the TV in the home.

“It makes a lot of sense for Amazon. We’ve seen them going in the direction of much more hardware,” Tom Giles, technology editor with Bloomberg, said on Bloomberg TV. “Why not go into TV?”

Giles said the new device, or Kindle upgrade, would enable Amazon to more effectively compete with the iPhone and iPad, as well as Samsung’s Galaxy brand.

The streaming media player market is dominated by Roku, which recently heralded its 5 millionth unit shipment since launching in 2008. Roku devices are sold on Amazon. Meanwhile, Amazon has been reticent about divulging user data for Prime Instant Video — it’s SVOD counter to Netflix, as well the number of Kindle devices actually sold.

An Amazon set-top box could provide a conduit to non-tech consumers parked in front of the TV, as well as up competition on Redbox Instant by Verizon, the rental kiosk vendor’s new digital platform offering subscribers unlimited streaming, in addition to disc rentals and electronic sellthrough.

“It’s just another way of creating [a new] ecosystem,” Giles said.

An Amazon representative said the company doesn't comment on rumors and speculation.