Amazon will start to include advertisements in films and shows on its Prime Video streaming service early next year unless you subscribe to a “new ad-free option” at an additional cost.
The global streaming giant revealed in a statement on Sept. 23 that commercials will be introduced in the United States, the United Kingdom, Germany, and Canada in early 2024, followed by France, Italy, Spain, Mexico, and Australia later in the year.
Amazon’s ad-free subscription tier will cost an extra $2.99 per month for Prime subscribers in the United States, the company said, noting that pricing for other countries will be shared at a later date.
“We will email Prime members several weeks before ads are introduced into Prime Video with information on how to sign up for the ad-free option if they would like,” Amazon stated.
The company said that it’s aiming to include “meaningfully fewer” commercials than traditional TV and other streaming providers, adding that the platform’s ad-free subscription is necessary so it can “continue investing in compelling content and keep increasing that investment over a long period of time.”
A Prime Video subscription—which is included at no extra charge with an Amazon Prime membership—currently costs $8.99 per month on its own. The company’s ad-free plan of nearly $3 per month means that customers would have to pay an extra 33 percent per month to continue watching Prime Video content without commercials interrupting their viewing sessions.
Meanwhile, the company also announced this week that it will not make changes to its Amazon Prime membership pricing in 2024, which currently costs $14.99 per month or $139 per year.
U.S. customers who decide to keep the ad-free viewing experience by subscribing to Amazon’s new plan will take the price of their Prime Video subscription from $8.99 per month to $11.98 per month, while Amazon Prime members will see their subscription fee increase from $14.99 per month to $17.98 per month.
Slowdown in Growth
Amazon—which already shows commercials on live event content such as NFL’s Thursday Night Football—is introducing its higher-priced ad-free tier as more streaming services push customers toward ad-supported tiers as the streaming industry grapples with a slowdown in subscriber growth.
The online retailer does not break down its Amazon Prime membership numbers, but market research company Insider Intelligence estimates that Amazon Prime Video is the third-largest video-streaming platform in the United States with 157.3 million subscribers, trailing only YouTube and Netflix.
Netflix and Walt Disney, meanwhile, have also recently rolled out similar ad-free subscription tiers, hoping a jump in ad revenue would make up for the slowdown in subscriber additions.
However, growth has been slow for the ad-supported plans. To boost subscriptions for the tier, Netflix has scrapped its basic commercial-free plan in the United States and the United Kingdom, while Disney has raised prices for its ad-free tiers.
Disney will start charging $13.99 per month in the United States for ad-free Disney+ in mid-October—75 percent more than the ad-supported service. Netflix already charges $15.49 per month for its ad-free plan, more than twice the monthly subscription for Netflix with ads.
Reuters contributed to this report.