Amazon Prime Video to have ads from 2024, to offer ad-free subscription tier at extra cost

Amazon Prime Video: Amazon Prime Video, a video streaming platform operated by tech giant Amazon, is looking to introduce ‘limited’ advertisements for its regular Amazon Prime subscribers starting in early 2024. As the company, which is a part of the tech sector’s Big Four, shared this information via Amazon News, it is all set to follow the footsteps of other industry leaders including Netflix and Hotstar which have already started showing ads in between their shows.

In the post published on September 22, Amazon said that it wants to continue investing in curating quality content for its viewers and to support this commitment, Prime Video shows and movies will include limited advertisements. “To continue investing in compelling content and keep increasing that investment over a long period of time, starting in early 2024, Prime Video shows and movies will include limited advertisements,” the company said. 

Fewer ads than other streaming services

Amazon, in the post, has clarified that despite viewers getting ads while watching shows and movies on Amazon Prime Video, the overall volume of the ads is going to be lesser than that of the other platforms. “We aim to have meaningfully fewer ads than linear TV and other streaming TV providers,” it asserted.

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To give an estimate of this, Netflix shows around four to five minutes of ads per hour split over multiple smaller ads. Some of the ads even last 75 seconds while the others can be 30 seconds short. On the other hand, Hulu shows five minutes of commercials for every episode while HBO MAX limits it to a 30-second long starting ad followed by around 30-45 seconds long two ads in between the show.

Ads to be introduced in 4 countries for now

At the beginning, not all countries that Amazon Prime Video is serving are going to be affected by the advertisement on the video content. Starting in early 2024, Amazon will introduce ads only in the United States, the UK, Germany, and Canada, followed by roll out in France, Italy, Spain, Mexico, and Australia later in the year.

“Ads in Prime Video content will be introduced in the US, UK, Germany, and Canada in early 2024, followed by France, Italy, Spain, Mexico, and Australia later in the year,” said Amazon.

Amazon’s official declaration has no mention of introducing ads for Indian subscribers. 

Pay extra for ad-free experience

Amazon Prime members would be able to skip watching advertisements in between shows and movies if they pay an additional $3 for the monthly subscription to the platform.

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Amazon will offer an ad-free tier at an additional cost of $2.99 per month in the US, where a standard Prime subscription is priced at $14.99 per month or $139 per year.

“We will also offer a new ad-free option for an additional $2.99 per month for US Prime members and will share pricing for other countries at a later date.”

While Netflix and Disney have also ventured into ad-supported plans to generate ad revenue amidst a slowdown in subscriber growth, the uptake for these plans has been relatively sluggish. Despite not disclosing precise Prime membership numbers, Amazon reported better-than-expected quarterly sales growth and profit in August, driven by improvements in its core growth engines - e-commerce and cloud computing.

Amazon's foray into advertisements and ad-free tiers shows a strategic response to evolving industry dynamics and a bid to diversify revenue streams.