Amazon will make its own TV shows

May 2, 2012, 4:44 PM UTC

FORTUNE — For months, the technology world has wondered when — not if — Amazon would get into original TV programing by soliciting scripts and beefing up its nascent in-house staff. Now, it’s official: Amazon (AMZN) will produce original television content.

On Wednesday, the company announced its intentions to develop original comedy and children shows that will be distributed by way of its online streaming service, Amazon Instant Video. “Amazon Studios wants to discover great talent and produce programming that audiences will love,” Roy Price, director of Amazon Studios, said in a release. “In the course of developing movies, we’ve heard a lot of interest from content creators who want to develop original series in the comedy and children’s genres. We are excited to bring writers, animators and directors this new opportunity to develop original series.”

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Amazon Studios will solicit original scripts, option one new project a month, and test that project with an audience. If the project is optioned, the creator will receive $10,000. If the project is turned into a full original series, the creator will $55,000 and up to 5% in royalties. As studio head Roy Price told AllThingsD, the company aims to make these original series have the same quality as “real” TV shows, with production budgets to match.

As Fortune reported in March, Amazon’s TV push will be led by Joe Lewis, a Hollywood veteran whose previous experience includes stints as Director of Production at 20th Century Fox , Manager of Development at Comedy Central, and CEO of the cloud-based TV network Bark Industries. At Comedy Central, he was an executive in charge of the production of Tosh.0, a series hosted by comedian Daniel Tosh that melds viral web videos with popular culture commentary. Fortune discovered Lewis’ hiring through a LinkedIn posting, which was later taken down.

“I think there’s a logic to it,” Gartner analyst Ray Valdes told Fortune recently of the effort. Valdes pointed to Google as one example of a company which is also focusing its efforts on new original content. Streaming service Hulu, meanwhile, plans to spend $500 million on TV and movie programming this year to round out its offerings of traditional broadcast and cable programming. And Netflix launched its first original series, Lilyhammer, last February.

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Original content of this type could prove to become an important driver of Amazon’s Prime service. Launched in 2005, Prime aimed to get customers to spend more. For $79 a year, members got free two-day delivery on an unlimited number of items. Amazon has sweetened its offerings from there adding, among many other features, an unlimited movie and TV streaming service similar to Netflix. The service is also intended to help sell more Kindle tablets. Original TV could bolster the entire offer — if shows take off.

Amazon Studios which launched in November of 2010, has received more than 700 test movies and 7,000 scripts to date. The company also has 15 movies in development.