Sep 22, 2023 - Economy

Amazon to run commercials on Prime Video

Photo: Katja Knupper/Die Fotowerft/DeFodi Images via Getty Images

Amazon on Friday said it would introduce a limited number of ads to movies and television shows on its Prime Video streaming service beginning next year.

Why it matters: Selling ads will allow the company to continue investing in compelling content "over a long period of time," Amazon said.

Details: The new ads will be introduced in the U.S., U.K., Germany, and Canada in early 2024, followed by France, Italy, Spain, Mexico, and Australia later in the year, the company said.

  • It vowed to serve "meaningfully fewer ads than linear TV and other streaming TV providers," but it didn't specify how many it planned to integrate into its programming.
  • The new ads won't change how much Amazon currently charges subscribers, the company said.
  • Amazon Prime members can access Prime Video as a part of their $14.99 monthly package. Amazon Prime Video subscribers can still access the video service as a standalone for $8.99.

Between the lines: The tech giant also announced that U.S. subscribers could pay an additional $2.99 for an ad-free option.

  • While it didn't offer an exact launch date, the company said it would email Prime members "several weeks before ads are introduced into Prime Video with information on how to sign up."
  • The company plans to share pricing for its ad-free tier in other countries at a later date, it said.

Zoom out: Most major streaming services have started to introduce ad tiers as a way of luring subscribers as the market becomes more saturated.

  • In many cases, ad tiers can also be more lucrative, because they can increase the amount of revenue made per subscriber.

Editor's note: This story has been corrected to reflect that the $2.99 tier will be free of ads (not ad-supported).

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