Amazon has decided to add advertising materials to its Prime Video service.
The media, with reference to the information contained in the mentioned company’s letter addressed to subscribers, report that the screening of commercials when watching TV shows and movies will begin on January 29. It should be clarified that this decision will initially affect those streaming service customers who live in the United States. From February 5, the screening of marketing videos will begin in Canada, Germany, and the United Kingdom. Also, next year, watching TV shows and movies will be associated with the need to familiarize yourself with advertising content in Italy, Spain, France, Australia, and Mexico. It is not yet known when the commercials will begin to be shown in these countries.
In a letter to subscribers, the business giant notes that the new decision was made to allow Prime Video to continue investing in attractive content and increase this funding over a long period. Probably, not all consumers will agree with this formulation or perceive it as a sufficient justification for the need to watch advertising videos. At the same time, this explanation does not contradict what can be defined as economic logic. In most cases, such decisions are made either against the background of financial difficulties, forcing so-called unpopular measures to improve profitability or solely to earn more money. However, there may be other, less common reasons for these actions.
Amazon, at the same time, gives subscribers the option not to view advertising videos. In this case, customers must pay an additional $2.99 per month. Additional consumer costs will eliminate the need to watch advertising videos.
Representatives of the company said that they aim to show much less marketing content than linear TV and other streaming TV providers.
Amazon first announced plans to advertise on the mentioned streaming service in September. At that time, the company also stated that this decision was necessary to continue investing in creating interesting content and increasing these financial injections over a long period.
Currently, many streaming services are expanding the distribution of advertising. Last year, Netflix launched a tier with support for marketing content. However, users have shown a low level of interest in this offer. Against this background, the company was forced to look for new advertising partners, adjust its pricing policy, and introduce various kinds of innovations.
Meanwhile, Warner Bros. Discovery’s Max recorded an increase in revenue after the launch of tiers with ad support.
Streaming services are also currently exploring solutions for launching monetization tools that are not related to advertising. For example, Disney+, according to preliminary information, plans to add recommendations on other products and services to its platform. The advantage of such a solution is that in this case monetization is provided in a way that is not particularly sensitive to consumers from a financial point of view.
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