Assuming that this is true and Amazon’s service does launch, it would put them in competition with the likes of cable and satellite television providers. Amazon is not the first company to show interest in such a service as Sony has announced something similar this year at CES, and Apple too has been rumored to be interested in a similar service as well, especially with its rumored iTV hardware. In fact it was recently that Intel announced that they would be selling their internet TV service to Verizon partly due to the fact that they were unable to negotiate content from content providers, which ultimately made it difficult to launch such a service. In any case we’re not sure if Amazon will be much more successful, but until then take it with a grain of salt.
Update – Amazon has since debunked the rumors.