Amazon Prime Video to Introduce Ads in 2024, Offering Ad-Free Option for $2.99 Extra
Amazon Prime Video users will soon see advertisements while watching their favorite shows and movies, as the company plans to introduce ads in early 2024. However, subscribers will have the option to pay an additional $2.99 per month for an ad-free experience. The change will apply to Prime Video users in the US, Canada, Germany, and the UK.
Amazon stated that it is making this change to continue investing in compelling content and increasing its investment over time. Prime Video has been a costly endeavor for Amazon, with expenses reaching $16.6 billion in 2022, including $7 billion spent on original content.
The introduction of ads to the entire service will allow Amazon to generate more revenue from advertisers and from users who choose to pay for an ad-free experience. Prime Video subscribers who opt not to pay the extra $2.99 will still experience fewer ads compared to traditional TV and other streaming services.
While some Prime Video content already features product placement and sports programming includes ads, this move marks a significant shift for the platform. Amazon’s decision comes as the company reported a 22% year-over-year growth in advertising services, reaching $10.9 billion in the second quarter of this year.
The Wall Street Journal previously reported that Amazon was considering introducing an ad-supported tier for Prime Video due to high interest from advertisers. The company currently ranks third in digital ad revenue, following Google and Meta.
Although the introduction of ads brings Prime Video’s pricing more in line with its competitors, it may disappoint budget-conscious cord-cutters who initially turned to streaming services as a cheaper alternative to cable TV. As the streaming landscape evolves with changing prices and scattered content, it seems that we haven’t strayed too far from cable after all.