Battle For Family’s Streaming Dollars Heats Up Between Netflix & Amazon, With Netflix Families Debut & Kindle FreeTime Expansion

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Following a bit of backlash arising from the loss of popular Viacom-owned children’s TV shows, Netflix today launched Netflix Families, which is essentially just a destination website designed to tout Netflix’s family fare. The site includes rows of Netflix recommendations for parents and kids, as well as tips on how to stream and other promotional content.

Amazon, not to be left unmentioned in today’s news, countered with an announcement of its own.

These moves come at a time when the war for streaming is heating up between Netflix and up-and-coming rival Amazon Prime Instant Video. Earlier this month, Amazon picked up the Viacom shows Netflix lost, including big-name kids’ TV brands like Dora the Explorer, Go Diego Go!, SpongeBob SquarePants, Blue’s Clues and several others.

Parents had earlier stormed Netflix’s consumer support site to complain about the losses, having already been burned by other ill-fated moves from the company in the past (like that Qwikster fiasco which became the symbol of Netflix “not listening,” CEO Reed Hastings once said.)

In addition to the new Families site, just yesterday Netflix also announced its largest original content deal to date with DreamWorks Animation, home to brands like Shrek and Kung Fu Panda. The deal involves some of DreamWorks Animation’s characters moving into TV (Shrek, most likely), in a branded collection of shows that will comprise more than 300 hours of new programming. The company also recently scored a content deal for other kids’ TV like “Jake and the Neverland Pirates” from Disney.

These titles, and more, will now be promoted on the Netflix Families website.

Not to be outdone, Amazon is also heading off this morning’s launch of the Netflix Families website with news of its own: the company released a progress report on Kindle FreeTime Unlimited, its optional service designed for parents with kids ages 3-8 which offers a variety of books, games, educational apps, movies and TV shows that play on Amazon Kindle Fire devices.

While FreeTime offers parental controls, Kindle FreeTime Unlimited is a paid add-on ($2.99 per child or $6.99 per family) which Amazon today says now combines over a thousand books, games, educational apps, movies and TV shows, including Disney’s “Where’s My Mickey?”, Warner Brother’s “LEGO Harry Potter Years 1-4″, “Dr. Seuss’s The Cat in the Hat Comes Back” from Oceanhouse Media, “Plants vs. Zombies” by EA, and Houghton Mifflin Harcourt’s “Curious George at the Zoo”.

Also added to FreeTime Unlimited? Yes, several Nick Jr. favorites – the recently acquired Viacom shows Netflix lost.

Other new arrivals include “Scribblenauts Remix” from Warner Bros., Disney’s “Puffle Launch” and “Toy Story Smash It! Classic”, EA titles like “Tetris”, “Bejeweled 2″, “Monopoly Millionaire” and “The Game of Life”, apps like “Curious George at the Zoo”, “The Berenstain Bears and the Big Spelling Bee”, “Mercer Mayer’s Little Critter and Triceratops Gets Lost from the Smithsonian Institution”, and more. (It’s a decent B-list of kids’ titles, for those without rugrats around to inform you).

Neither Amazon nor Netflix’s announcement today is the equivalent of what one would call major news, of course. One is a destination site to educate and promote Netflix’s children’s programming, while the other is an update on what’s available with Kindle FreeTime Unlimited.

What is interesting about the news is that both companies seemed to have decided that where the children go, so go the parents. The war for streaming is resting on families’ youngest members – a generation of viewers who have born into a world where tablets already exist, and who can navigate their way around the devices better than their parents in many cases. It’s these little ones the streaming giants will now be catering to.

Paying for a streaming video service on top of other in-home entertainment bills like cable TV and high-speed internet is still a luxury add-on for most families in a down economy like ours, and that means either Netflix or Amazon will win customers family by family, instead of counting on families to sign up for both. It’s also the same reason why other streaming video services, like Redbox Instant for example, have trouble getting off the ground.

Expect this battle to continue to heat up later this summer as well, when Netflix finally reveals its long-awaited user profiles, which will give kids and parents their own window into Netflix content, personalized recommendations, and more. And if Netflix is smart about things, hopefully it will also introduce parental controls and other Kindle FreeTime-like features, too.