Amazon plans to release a television set-top box that would stream video over the internet into customers' homes.
The plan is to release the box, which will connect to televisions, later this year. It will also provide access to Amazon's expanding video services, which include the Amazon Video on Demand store.
The move is still secret, but Bloomberg claims that Amazon CEO Jeff Bezos wants to push the company into a broadening array of hardware, including tablets, electronic readers and a planned smartphone.
In fact it looks like he is trying to turn Amazon into a more flexible version of Apple. The difference is Apple spiced up its hardware by adding content, while Amazon is moving from content by adding hardware.
The device would also compete with products from Roku and Boxee, gaming consoles from Microsoft and Sony that deliver video programming and Intel's planned channel.
Jason Krikorian, a general partner at venture-capital firm DCM, and the former co-founder of Sling Media said that the idea did make a lot of sense. After all Amazon had a ton of content and an existing billing relationship with millions of users.
The set-top box is being developed by Amazon's Lab126 division, based in Cupertino. Lab126 has toyed with building connected television devices for several years.
It is difficult to tell how much the service will cost. Apple normally sells hardware at a loss, with the intent of making up for discounts through sales of content, including books and movies.
According to Bloomberg, the project is being managed by a former vice president at Cisco Systems, Malachy Moynihan, who worked on the networking giant's various consumer video initiatives and worked for nine years at Apple. Also involved is Andy Goodman, formerly a top engineer at TiVo and Vudu and Chris Coley, a former hardware architect at ReplayTV, one of Silicon Valley's first DVR companies.