Amazon Prime Video Introduces Ad-Free Tier at Extra Cost
Starting late January, Amazon Prime Video users who wish to avoid advertisements will need to pay an additional $2.99 per month. This new ad-free tier, set to launch on January 29, comes in addition to the existing costs for Amazon Prime subscriptions. The annual Prime subscription is priced at $139, while the standalone Amazon Prime Video subscription is $8.99 per month.
As a result, subscribers who opt not to pay the extra fee will begin encountering ads on Prime Video content from the same date. This move, announced in September, aims to integrate a controlled number of ads, purportedly fewer than those on linear TV and other streaming TV providers.
With the implementation of this new fee structure, here's a comparative look at the costs of various streaming services:
- Amazon Prime Video Ad-Free (standalone): $10.99/month
- Amazon Prime Video Ad-Free (with Prime subscription): $16.99/month
- Netflix Standard: $15.49/month
- Disney+ Ad-Free: $13.99/month
- Hulu Ad-Free: $17.99/month
- NBCUniversal's Peacock: $11.99/month
- Max: $15.99/month
Advertising has become an increasingly significant component of Amazon's revenue, constituting over 8% of the company's total net sales, as per their financial statements. Notably, advertising income has even surpassed the revenue generated from subscription services.
Amazon has acknowledged ongoing net losses related to the licensing and distribution of video content. These challenges reflect broader issues in the streaming industry as platforms strive to establish financially sustainable models, often leading to price hikes for consumers.