Report: Amazon considering adding Ads to Prime Video
Amazon is considering integrating advertisement into its Prime Video service, according to a Wallstreet Journal report. Amazon might introduce a new ad-powered tier to Prime Video or introduce advertisement to the current subscription plan, according to the report.
Amazon is already the third-biggest advertising company in terms of digital ad revenue in the United States after Google and Meta. The company hopes to increase advertising revenue further, but Amazon has yet to decide on a strategy to do so.
An ad-powered Amazon Prime tier would follow Netflix and Disney, two of Prime Video's main competitors. Both companies have introduced cheaper plans that push advertisement to subscribers.
Netflix announced last month that the subscriber count of the streaming service's ad tier has crossed the 5 million subscribers mark and that the plan is earning the company more revenue than the cheapest ad-free plan.
Amazon is considering two main scenarios: the first introduces a new ad-powered plan to Amazon Prime. This plan would be cheaper than the regular Amazon Prime subscription, but it would display advertisement to subscribers. Amazon Prime subscriptions include access to Prime Video. It costs $14.99 currently per month or $139 per year in the United States and less than that in other regions. Discounts are available for certain groups, including college students. There is also a Prime Video-only plan available for $8.99 per month in the United States.
The new ad-powered plan would be priced below $9. As a comparison, Netfllix's standard with ads plan is available for $6.99 in the United States, which is $3 less than the Basic plan and $9 less than the Standard plan. If Amazon follows Netflix's example, it could price Amazon Prime Video with ads at $6 per month.
The second scenario that Amazon is considering is adding advertisement to existing Prime Video subscriptions and adding a new ad-free plan that would cost more than the current plan. The Wallstreet Journal notes that Amazon might drop the plans altogether as well.
Amazon has launched a free advertisement-powered service called Freevee in certain regions recently. The company has also announced the upcoming launch of Fire TV Channels, another free ad-powered service that is exclusive to Fire TV products, such as the Fire TV 4K Max.
Depending on how Amazon integrates advertisement into Prime Video, it could either unlock a new option for some users, if a new ad-powered tier is added without changing existing plans, or irritate existing subscribers, if they suddenly start seeing ads and options to pay more to stop seeing these.
Advertising is coming to streaming services and it is almost certain that other streaming providers are watching the development carefully.
Now You: what is your take on all of this? Would you subscribe to ad-powered streaming plans?