Amazon has announced that ads will be introduced on January 29 for Prime Video’s entertainment content. The commercials will be included with series and movies airing on the service in the U.S, UK, Germany, and Canada. Later in the year, they will be gradually added to France, Italy, Spain, Mexico, and Australia. Subscribers have been notified of the addition of “limited advertisements” to allow the service to continue investing in content.
While this change has been met with some resistance from subscribers, it is increasingly becoming the norm for streaming services to adopt a dual subscription-ad model. Netflix and Disney+ have recently introduced ad tiers, and now Amazon Prime is joining the trend. Apple TV+ remains the only major streaming platform that employs a pure subscription model.
The addition of commercials is another step forward for Amazon’s advertising ambitions. The company has been on a major ad offensive for years, using live sports as well as ad-supported Prime Video platforms such as Freevee and Twitch. While Amazon earned $38 billion from advertising last year, which is only a small share of the company’s $502 billion in total annual revenue, the rate of growth is impressive, with more than a 20% quarterly clip.
In September, Amazon announced that it would introduce ads to Prime Video’s entertainment content. The move has been anticipated for some time and is now just a few weeks away. Subscribers were sent a letter addressing the change and explaining the addition of ads to support long-term investment in compelling content.
In a world where streaming services and advertising are becoming increasingly intertwined, Amazon’s latest move towards ads could mark a significant turning point. As the company continues to invest in advertising and broaden its reach, we can expect to see further changes and innovations across the sector. It remains to be seen whether other major platforms follow suit, but it is clear that the business models for streaming are continuously evolving.
In a message to subscribers, Amozon said “We will also offer a new ad-free option for an additional $2.99 per month … Prime Video customers have the option to pre-register for the monthly ad-free option, but won’t be billed until January 29.”