Amazon plans to run limited ads on Prime Video in the US, the UK, Germany, and Canada starting in early 2024, charging $2.99/month extra in the US to avoid ads

- Prime Video will offer a more expensive ad-free option — Streamers want to increase revenue as production costs soar

Bloomberg 2023-09-23

Context & Ripple Effects

This is an early step in Prime Video’s shift from a single included benefit toward differentiated viewing options. Related coverage later fixed the rollout at a January 29 start date, making the announced surcharge an operational subscription choice rather than a one-off experiment.

The subsequent record shows the model being extended: Amazon planned more ads after subscriber losses remained limited, and later coverage points to a higher-priced ad-free tier. That sequence makes the initial $2.99 fee consequential as a new revenue layer within the Prime bundle.

First-order effects

Prime Video viewers in the named markets will receive ads by default, while U.S. customers who value uninterrupted viewing can pay $2.99 per month to opt out.
Amazon gains two immediate monetization paths from the same audience: advertising sales and incremental payments from ad-free subscribers.

Second-order effects

The added ad inventory gives Amazon a reason to balance ad load against retention; the later plan for a larger ad load shows that subscriber response becomes a key constraint on that balance.
Competing streaming services face stronger pressure to make their own ad-supported and ad-free tiers economically distinct, rather than relying solely on subscription price increases.

Third-order effects

If this approach sustains engagement, bundled streaming benefits can increasingly function as segmented media businesses, with advertising underwriting the default experience and ad-free access sold as an upgrade.
The durable industry shift is toward monetizing viewing time as well as subscriptions; the trade-off is that heavier ad loads may eventually test the value perception of bundles.

The trend: Streaming services are turning ad-supported default tiers and paid ad-free upgrades into a central response to rising content costs.

Discussion

UPROXX UPROXX on x
What Does Amazon Prime's New Plan For Commercials Mean For Your Subscription?
@carnage4life Dare Obasanjo on threads
Watching streaming shows without ads was a zero interest rate phenomenon.
@trevorcroker Trevor Croker on threads
Apple TV+ is now the only major streamer that doesn't have an ad-tier. https://www.bloomberg.com/...
@joepierce@mastodon.scot Dr Joseph Pierce on mastodon
Mark my words: I will stop watching Prime shows before I watch a single ad on that platform or give them bonus bucks to skip them. I'm permanently done with ads in video. I have basically stopped watching sporting events because of the ad load. — There are too many ads in the…
@glinden.bsky.social Greg Linden on bluesky
Some keep arguing that subscription based business models are more closely aligned with customer satisfaction, but, as you can see with these new ads and in how much Amazon pushes upselling in Prime Video, paying a subscription is no guarantee. [embedded post]
@loudmouthjulia Julia Alexander on x
On the one hand, Amazon adding ads to Prime Video is another “streamer goes dual revenue” story. Also: Amazon's advertising business grew by more than 20% quarterly. It brought in nearly $40B last year. It's also hyper targeted. And it owns the supply and distribution sides.
@loudmouthjulia Julia Alexander on x
Amazon is the ultimate ecosystem; Google is the ultimate utility. Both have the most impressive targeting advertising capabilities for companies who want to be in and monopolize video. YouTube and Twitch are also disrupting and monetizing the supply (creation) side of video.
@richontech Rich DeMuro on x
BIG CHANGE for Amazon Prime Video in 2024: Unless you pay $3 a month, you'll start seeing ads so, Prime Video no longer really included in a Prime membership... https://www.aboutamazon.com/ ...
@karlbode Karl Bode on x
the enshittification of streaming video continues with Amazon's decision to charge people who already pay $140 a year for Amazon Prime an additional $3 to avoid video ads. How very innovative: https://www.theverge.com/...
@smtuffy Sean Tuffy on x
Cable television, they're recreating cable television
@smtuffy Sean Tuffy on x
More seriously, I'm not sure everyone has made peace with the fact that US television basically has to be ad supported or subs have to cost a fortune. Pick your poison
@sarthakgh Sar Haribhakti on x
While the “new TV is same as old TV” meme is fun, it is not the same at all Just the sheer ability to easily sign up and cancel streaming services makes it a 10x better UX than cable The “IDK what service has the show I want to watch” problem is overstated. Just Google it!
@jyarow Jay Yarow on x
The more the disruptors act like incumbents, the more attractive the incumbents become. Cable TV is a better tech and interface than the app-based structure of Apple TV, Netflix, Prime, et al. Wonder if Cable can capitalize in any way to take back share.
r/technology r on reddit
Amazon Prime Video will soon come with ads, or a $2.99 monthly charge to dodge them
r/thegrandtour r on reddit
Amazon Prime is getting ads
r/LOTR_on_Prime r on reddit
Rings of Power Season 2 to have commercial breaks unless you pay an extra $2.99 per month to remove ads (on top of your Prime subscription). …
r/movies r on reddit
Amazon Prime Video shows and movies will include limited advertisements starting in 2024 - New ad-free option available for an additional $2.99/m

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