Amazon to introduce ads to its Prime Video streaming service

Tech giant Amazon will begin including ‘limited’ adverts with to shows and movies on its Prime Video SVoD service – but for an additional charge you’ll be able to keep them off your screen.

After clearing its throat by celebrating its original content chops and highlighting awards its won for shows like The Marvelous Mrs Maisel, Amazon said in a blog post that it is introducing the ads in order to continue investing in content and increase that investment over a long period of time.

And it certainly has got the wallet out in recent years in this regard – in 2021 it bought MGM for $8.45 billion, and its recent Lord of the Rings spin off ‘The Rings of Power’ is apparently the most expensive show ever made.

The ads will be introduced initially in the US, UK, Germany, and Canada in early 2024, followed by France, Italy, Spain, Mexico, and Australia later in the year. The current price of Prime membership will not change, but a new ad-free option will be made available for an additional $2.99 per month in the US, with pricing for other countries to be released at a later date.

Amazon added that ‘We aim to have meaningfully fewer ads than linear TV and other streaming TV providers’ – though exactly what meaningfully fewer means is left undefines. However it stipulates that live event content such as sports will continue to include advertising, even for the upgraded service.

Many streaming service appear to have concluded that a single stream of revenue for producing, hosting and delivering shows and movies is not sufficient, and have pursued advertising as well. Netflix opted to roll out a cheaper version which will include ads as its approach – by contrast Amazon is serving them across the board and asking for an additional few quid a month for a resumption of normal service.

According to data from May courtesy of UK audience measurement body Barb, the number of UK households with a subscription video-on-demand service continued to decline in the first quarter of 2023, presumably as a consequence of the cost of living crisis and many finding themselves unable to justify multiple subscriptions to the now quite crowded streaming market.

Whether this move by Amazon gives some an excuse to ditch Prime Video on this basis remains to be seen – but the fact it basically already comes alongside the Amazon Prime free delivery service for its etail business may offer a decent ballast against household budget culls.

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