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Amazon’s new Fire TV head wants to take TV streaming on the road

Daniel Rausch, who took over the leadership of Amazon's entertainment devices and services business this spring, is betting on 5G-connected cars as the next frontier for TV OSes.

Daniel Rausch, wearing glasses, standing against a wall wearing a blue shirt

Amazon has sold millions of Fire TV sticks across the globe, says Daniel Rausch, the company's head of entertainment devices and services.

Photo: Amazon

Amazon has sold millions of Fire TV sticks across the globe, and struck up partnerships with a number of TV manufacturers to embed the Fire TV operating system into their devices. Now, the company is looking to cars as the next frontier.

Veteran Amazon executive Daniel Rausch took over the company's entertainment devices and services business in February. In a conversation with Protocol, Rausch explained why he is bullish on cars, how consumer habits changed during the pandemic, why Amazon is organizing its game-streaming service around channels and why his living room has become his gym.

This interview was edited for length and clarity.

You took over the Fire TV business a little over three months ago. How have things been going?

The business is doing really well. Fire TV Stick 4K was the bestselling product during Prime Day overall, and we sold a record number. That's on the stick side. We also sold a record number of Fire TV Edition televisions. When you look at the whole Prime Day period, including the lead up and then through those days, [we sold] more TVs than we've ever sold before.

There are also some core things about the user experience that are going well. We'll continue to lean into the content-forward nature of Fire TV. We know that, as customers acquire more content-streaming options, they need help sorting through that. They need help with discovery. They need help navigating to the familiar things that they're looking for. And we're seeing customers respond as we get even better at navigating content.

[Since the launch of our new UI,] we've seen that browsing habits have increased. Customers are [spending] more time in it, but they're also just discovering more content. If you take some features together, like App Peaks, which gives you access to content without needing to ingress and egress out of every one of your apps; Find, where we consolidated a bunch of search and find capabilities; and Live, which is a new way of bringing together live content — nearly 50% of impressions are split across those now.

Our emphasis on voice is also increasingly paying off. Many customers start with a simple search, but they quickly move on to discover that you can do much more with voice. Asking Alexa what the weather is going to be tomorrow, for example; having that come up as a partial panel on your TV without interrupting your experience, and then you're right back into your content. Customers are using Alexa in new ways, and discovering that they like to fluidly move in and out of that experience.

Have you seen Fire TV usage habits change throughout the pandemic?

We did a GlobalWebIndex study, and asked customers what kind of content they're really appreciating during these times. News was the top answer. It's something we're [also] seeing in the data. The consumption of news content doubled year-over-year. We launched [the Fire TV news app] with over 80 cities, where you could get local news, and we're just seeing customers really respond to that.

Fitness is another key area that we've just seen taking off. It's up 115% year-over-year. The living room has become a workout center for many of us. It still is for me. A few years ago, you would have seen fitness as sort of just an edge case. An interesting experiment going on in streaming. It is a full-blown revolution in the way people are working out in their homes [now].

In early 2020, Amazon said that it wanted to work with pay TV operators to license the Fire TV OS, but we haven't heard much on that front since. What's the status of those efforts?

We've experimented with several distribution options. Nothing to report on that type of partnership at this point. I will say that we're eager and willing to work with anyone, because we believe that customers want the option for Fire TV wherever they can access it.

The set of [TV manufacturer] partners that we have with our Fire TV Edition just continues to grow. Last year, we launched with six new brands. We're up to over 80 Fire TV Edition products globally, which is sort of a new high watermark for us. Six of the top 12 countries selling Fire TV more than doubled last year in terms of [unit] sales.

What about other new form factors? Anything on the horizon you can share?

We do see interest in the auto segment. Screens are coming to autos in greater numbers, and I'm very interested in being where customers want to be entertained, which is frankly just about everywhere, including on the go. It's not just about streaming in the living room. 5G connectivity is going to transform that as well, because you just get a high-quality connection anywhere you go in your car.

We announced our partnership with Stellantis to launch Fire TV in Jeep and Jeep Wagoneers. I would give a lot to go back and have that option for the rear-seat entertainment system in our car when I had three kids in 20-odd months.

You are also overseeing Luna, Amazon's game-streaming service. What's the status of that?

It's in early access. We're learning a lot both from customers and from our partners on the game development side, and we're getting very good signals from them. If you look at things like the Luna controller, it's rated 4.3 stars.

Other companies have tried cloud gaming with Netflix-like, all-you-can-eat subscription approaches, or by selling access to individual titles. Amazon is instead letting people subscribe to channels, including one from Ubisoft. Why did you decide to use this model, which is very similar to the way Amazon sells video subscriptions?

We're definitely seeing a response from customers that indicates that they like the channel model. It lets you develop different packages for different customers. A channel model lets you surf, browse, taste, try content, subscribe to a new channel, maybe that has a theme that you like. Not only are we seeing in the early data that customers are loving it, we believe it offers a palette to us and game developers to help curate a great selection for customers.

So when will you open Luna up to everyone?

Stay tuned.

Since channels seem to work so well for Amazon, are we going to see you use that model for other types of content or experiences? Maybe exercise, since you pointed out that there's such a demand for it?

That's a great idea. I will take it back to the team.

Protocol | Workplace

The Activision Blizzard lawsuit has opened the floodgates

An employee walkout, a tumbling stock price and damning new reports of misconduct.

Activision Blizzard is being sued for widespread sexism, harassment and discrimination.

Photo: Bloomberg/Getty Images

Activision Blizzard is in crisis mode. The World of Warcraft publisher was the subject of a shocking lawsuit filed by California's Department of Fair Employment and Housing last week over claims of widespread sexism, harassment and discrimination against female employees. The resulting fallout has only intensified by the day, culminating in a 500-person walkout at the headquarters of Blizzard Entertainment in Irvine on Wednesday.

The company's stock price has tumbled nearly 10% this week, and CEO Bobby Kotick acknowledged in a message to employees Tuesday that Activision Blizzard's initial response was "tone deaf." Meanwhile, there has been a continuous stream of new reports unearthing horrendous misconduct as more and more former and current employees speak out about the working conditions and alleged rampant misogyny at one of the video game industry's largest and most powerful employers.

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Protocol | Workplace

Founder sues the company that acquired her startup

Knoq founder Kendall Hope Tucker is suing the company that acquired her startup for discrimination, retaliation and fraud.

Kendall Hope Tucker, founder of Knoq, is suing Ad Practitioners, which acquired her company last year.

Photo: Kendall Hope Tucker

Kendall Hope Tucker felt excited when she sold her startup last December. Tucker, the founder of Knoq, was sad to "give up control of a company [she] had poured five years of [her] heart, soul and energy into building," she told Protocol, but ultimately felt hopeful that selling it to digital media company Ad Practitioners was the best financial outcome for her, her team and her investors. Now, seven months later, Tucker is suing Ad Practitioners alleging discrimination, retaliation and fraud.

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Amber Burton (@amberbburton) is a reporter at Protocol. Previously, she covered personal finance and diversity in business at The Wall Street Journal. She earned an M.S. in Strategic Communications from Columbia University and B.A. in English and Journalism from Wake Forest University. She lives in North Carolina.

Protocol | Fintech

The digital dollar is coming. The payments industry is worried.

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Jodie Kelley is CEO of the Electronic Transactions Association.

Photo: Electronic Transactions Association

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