Amazon is considering joining its main streaming rivals Netflix and Disney+ in launching an ad-supported version of its Amazon Prime streaming service, according to the Wall Street Journal.
Amazon declined to respond to the WSJ’s report and sources say plans are in the early stages. According to the report, it's part of an overall strategy to find new ways to introduce advertising, including adding ads for current Prime subscribers and then soliciting an ad-free option for a fee added on to their current subscription. This, in essence, would end Amazon’s policy of providing an ad-free version of its streaming service gratis to current Amazon Prime members who currently pay $14.99 per month. (subscribers to the streaming service who are not Prime members pay $8.99 a month).
Amazon already offers ad-free versions of Max and Paramount+ via its Prime Video Channels and includes ads in its Thursday Night Football games. It also offers the FreeVee ad-supported streaming service. Amazon says it made $9.5 billion in ad revenues in its most recent quarter.
If implemented, the move would represent one more streaming service offering lower cost ad-supported tiers after Netflix and Disney+ launched similar services recently. As part of its efforts to improve its bottom line, Netflix also recently started its long-anticipated crackdown on password sharing,
Amazon, which has recently gone through a series of cost-cutting measures, is also under pressure due to the rising costs of its original programming. Its "Lord of the Rings: The Rings of Power" series, which launched its first season in 2022, is the most expensive TV series in history, with its first season costing an estimated $715 million to produce.
In terms of subscriber numbers, Amazon Prime has an estimated 168 million worldwide, according to estimates from Consumer Intelligence Research Partners, second only to Netflix, which has 230.75 million. Disney + is third with nearly 162 million.
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Tom has covered the broadcast technology market for the past 25 years, including three years handling member communications for the National Association of Broadcasters followed by a year as editor of Video Technology News and DTV Business executive newsletters for Phillips Publishing. In 1999 he launched digitalbroadcasting.com for internet B2B portal Verticalnet. He is also a charter member of the CTA's Academy of Digital TV Pioneers. Since 2001, he has been editor-in-chief of TV Tech (www.tvtech.com), the leading source of news and information on broadcast and related media technology and is a frequent contributor and moderator to the brand’s Tech Leadership events.