Ads on Prime Video Were More Than an Experiment: Amazon Announces That It’s Increasing Them on the Platform

The inclusion of ads on streaming platforms is becoming more common. This was once frowned upon because subscribers were already paying for the service. However, due to high expenses and the introduction of new, higher-priced, ad-free tiers, these platforms now see ads as another way to increase revenue.

The same amount of subscribers. According to the Financial Times, Amazon hasn’t seen a decrease in Prime Video subscriptions since it started showing ads in January. Similarly, Netflix didn’t see account cancellations when it raised prices, enforced restrictions on shared accounts, and introduced advertising in its programming.

More ads. Kelly Day, vice president of Prime Video International, told the Financial Times that the platform will increase the number of advertising slots in 2025. Currently, the streaming service shows ads at the beginning of movies and occasionally during films and TV shows in blocks of two or three. Day said the ad load had been intentionally kept “very light” as a “gentle entry into advertising that has exceeded customers’ expectations.”

200 million people watching ads. Amazon reports that 200 million people globally watch ads on its platform. However, not all Amazon Prime account holders are necessarily viewers of the ads because not all Amazon Prime account holders use Prime Video even though the service is included in their membership. In any case, this is the number of potential target users the company communicates to advertisers. Half of the viewers are located in the U.S.

Interactive ads. In the future, Amazon hopes more subscribers will pay an extra $3 a month to remove ads on movies and TV shows. However, for now, the company is getting creative and plans to introduce interactive, “shoppable” ad formats. These will allow viewers to add items to their Amazon cart or get more information about brands without leaving the streaming service. This integration with its e-commerce platform gives Amazon a significant advantage in utilizing these capabilities.

All platforms are giving ads a try. Netflix was the first platform to experiment with this disguised price rise. Unlike Prime Video, Netflix emphasizes ad-free subscriptions and has been successful so far. Previously, platforms like Disney+ and Max either advertised directly or included advertising. They all changed their pricing early this year, with Prime Video being the most resistant to including advertising. However, business seems to be doing well: Netflix has more subscribers than ever, and Amazon announced advertising revenues of $12.8 billion in the second quarter of 2024. Clearly, advertising is here to stay.

Image | Amazon Prime Video

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