As Amazon's ad revenue passes YouTube's and US pay TV subscriptions drop, ad budgets will shift further to targetable spots and other customer-acquisition tools
Benedict Evans : Tweets: @tomroach , @hkanji , @mrstephendeng , @durgaraghunath , @jeffjarvis , @nairsameer , @rahulwelde , and @damianburns See also Mediagazer Tweets: Tom Roach / @tomroach : A simple chart suggesting a thousand stories about the last 70yrs in the ad business, from the always outstanding @benedictevans in https://www.ben-evans.com/... https://twitter.com/... @hkanji : Amazon's ad business is bigger than YouTube and more profitable than AWS. Shein is the biggest fast-fashion retailer in the US, with no stores. https://www.ben-evans.com/... Stephen / @mrstephendeng : Traditional digital advertising in Africa is very limited in reach. Look at Facebook's ROW advertising revs. Here's @benedictevans's thoughts on the merging world of logistics and discovery - a key piece in our digital commerce thesis. More to come. https://www.ben-evans.com/... https://twitter.com/... Durga Raghunath / @durgaraghunath : At the end of 2021 @amazon started splitting out their ad revenue into a sep line and that number is at $31B. This is as large as the Google Display business, YouTube or the entire global newspaper industry ad revenue, writes @benedictevans https://www.ben-evans.com/... Jeff Jarvis / @jeffjarvis : Another brilliant @benedictevans analysis, this of the shrinking advertising market and the new owners of it. Media lose and lose again. https://twitter.com/... Sameer Nair / @nairsameer : “...ask where all these ad budgets are coming from, and, more importantly, where the growth will come from next. The obvious answer is television: print is mostly already gone, but ‘TV’ viewing is now finally unlocking...” @skswamy https://www.ben-evans.com/... Rahul Welde / @rahulwelde : Top article that looks at the money flowing through advertising. Who is winning and why, where are budgets moving to and where will future growth come from. Must read. @benedictevans aces it in simple narration and charts. https://www.ben-evans.com/... Damian Burns / @damianburns : The evolving dynamics of advertising, media and retail Excellent from Benedict Evans https://www.ben-evans.com/... See also Mediagazer
Context & Ripple Effects
This chart caps an arc the related coverage has been tracking since GroupM measured the Google-Facebook-Amazon triopoly at 90% of US digital ad spend: the question was no longer whether a third force would emerge, but which one. Stratechery's 2022 review framed it as the duopoly becoming a triopoly-plus-Apple; Evans' data point — Amazon's ad revenue passing YouTube's while US pay TV shrinks — shows the third leg is now bigger than the incumbent video giant's ad business.
First-order effects
- Advertisers deciding between brand reach and measurable acquisition now have a platform whose targeting is tied to purchase behavior, and the coverage shows budgets already moving that way after Meta's ATT-driven price increases pushed some advertisers to Google, Amazon, and TikTok.
- Pay TV sellers face a shrinking subscription base and a shrinking share of the ad dollar at once — their inventory is losing both audience and relevance as the targetable alternative scales.
Second-order effects
- YouTube's position inverts: it wins viewership but loses the ad-revenue race to a retailer whose ads close to a transaction, forcing Google to argue for video's upper-funnel value rather than raw dollars.
- Retail media becomes a competitive requirement for every large commerce player — once advertisers treat Amazon's ads as a customer-acquisition channel rather than a retail add-on, other marketplaces must build equivalent ad businesses or cede that budget line.
Third-order effects
- The industry's center of gravity moves from selling attention to selling attributable outcomes, favoring platforms that own the purchase data and squeezing intermediaries whose value was reach alone.
- If the pattern holds, ad-market structure consolidates around a handful of commerce-and-search platforms, with the later data point of $38B in Amazon's 2022 ad revenue — above the entire global newspaper industry suggesting this is compounding, not cyclical — though how much further pay TV declines versus stabilizes as bundled streaming remains genuinely open.
The trend: Advertising is rotating from reach-based television and social-brand spend toward commerce-linked, targetable customer acquisition, with Amazon's ascent marking the shift's clearest marker.