Amazon.com, Inc. (AMZN), Apple Inc. (AAPL): Apple TV’s Next Competitor?

Amazon.com, Inc. (NASDAQ:AMZN) and Apple Inc. (NASDAQ:AAPL) are two tech companies which have recognized over the last couple of years that the new battleground for market share in the tech world is the living room – where most American televisions reside. Apple started working its way into the TV space with an AppleTV set-top box, and Amazon in the last few months developed Prime Instant Video to compete directly with Netflix, Inc. (NASDAQ:NFLX), which is the clear market leader at delivering  digital video content via the Internet through a television or other computer device (tablet, desktop, PC, smartphone).

And we can’t forget Microsoft Corporation (NASDAQ:MSFT), which first got into the living room with its Xbox gaming console and services, and it now offers streaming video capability through the console as well, which is viewed as a serious competitor by Apple Inc. (NASDAQ:AAPL), Amazon and Netflix.

The competition is intensifying, and Amazon.com, Inc. (NASDAQ:AMZN) is apparently close to complementing its current video streaming service by adding its own hardware – a set-top box that would allow users to access Amazon’s expanding library of digital content. Currently, Amazon.com does make its video content available through other devices like a Roku set-top box, but this is expected to put Amazon content directly on TV screens and would be an incentive for developers to create applications for the growing platform–very Apple-like indeed.

The story was reported by Bloomberg and it cites unidentified sources, so there is little way to know how legitimate this new device is in the Amazon.com, Inc. (NASDAQ:AMZN) pipeline.

If such a device truly exists, Amazon.com so far is no talking about it, and here has been no mention about a new product release event yet. But what do you think? Is it a logical step for Amazon.com to move into the set-top box space in terms of Internet video? What about Apple Inc. (NASDAQ:AAPL)?

Let us know your thoughts about the living room and the growing competition in the comments section below. Which company do you think has the advantage in the space now, and which do you think will win the battle long-term?

DISCLOSURE: I own no positions in any stock mentioned.