Amazon plotting ad-supported streaming service?


Amazon has experimented with advertisements for streaming video before.

AdAge reports that Amazon may make the freemium version of Prime Video happen by sharing audience information and ad revenue in order to improve its initial efforts with the initiative. But to be fair, everyone continues to lag behind Netflix in that particular race.

The news arrives in an environment increasingly populated with new players to the streaming video game, including CBS All-Access, Facebook's Watch service, or the upcoming streaming platforms from Disney and Apple. It sounds like the new service could be a separate entity from Amazon's current Prime Video service, rather than simply the same service with commercial interruptions. But the differentiating factor is that these shows are available to watch for free, and majority are interrupted by advertisements. According to AdAge's sources, payments would be "linked" to how often a show or movie is watched. "The company is talking with TV networks, movie studios and other media companies about providing programming to the service", Ad Age reports, citing sources. An ad-supported membership tier could help it strengthen its lead.

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A free, ad-supported version of Prime would be promoted alongside the existing version made available to Prime members, who gain access to originals like Transparent and The Man in the High Castle, along with library titles by paying $99 a year, which also entitles them to free shipping and other Amazon benefits.

So how can Amazon get more eyeballs on their (very expensive) content? Amazon's service should employ a similar model, with the main difference being that it will pay creators royalties.

As Amazon seems to be struggling to make an impact in the SVOD landscape among competitors like Netflix and Hulu, this could be the company's chance to deepen its roots in a more creator focused area like it has done in the past with Amazon Video Direct, which allowed just about anyone to make their content available to Prime Video subscribers and receive a per-hour royalty fee.