Prime Video Plans to Launch Ad-Supported Subscription Tier

Ad-supported subscription tiers are quickly becoming commonplace in the streaming world. Netflix and Disney+ most recently embraced the ad model as a cheaper option amidst a slowdown in new signups with more customers looking to cut expensive streaming bills out of their budget. Now, Prime Video is about to get its ads on as the Wall Street Journal reported that Amazon is in the early stages of planning an ad tier for its platform. Inside sources say that discussions have been ongoing for the past few weeks.

With the new tier, Prime Video looks to capitalize on its strong position in terms of ad revenue. Amazon has raked in $9.5 billion in the first quarter and sits as the third-biggest fish in the ad revenue pond, falling behind only tech behemoths Meta and Google. Advertisers are apparently eager to have their promotions in front of the content on offer at the streamer like The Marvelous Mrs. Maisel and its wide film catalog, leaving a lot of money on the table that would help cover the cost of its original programming and films. The company also seeks to further expand its offerings, namely a deal with the NBA not-unlike like what it inked with the NFL for Thursday Night Football games which the ad tier could make possible. Mainly, though, CEO Andy Jassy wants to make Amazon’s streaming division profitable after Jeff Bezos‘s reign which sought solely to expand with pricey, high-profile series like The Lord of the Rings: The Rings of Power.

A model for what this tier could look like hasn’t been decided on, but there’s a chance it will come at a cost to current subscribers. While a cheaper ad tier is one option, Amazon is also weighing creating a higher-priced ad-free tier while rolling out more ads in short breaks for all current subscribers whether through an Amazon Prime account, which currently costs $14.99 per month, or a standalone Prime Video subscription, currently at $8.99 a month. As the Wall Street Journal noted, this wouldn’t be out of character for Amazon as it employed a similar model to its music offering which limited on-demand listening to pricier subscriptions. The possibility that no plan comes to fruition is still on the table too, but it seems unlikely given everything the streamer has planned.

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Ad-supported content isn’t new for Amazon in the streaming space. Its push for live sports coverage has also come in part because of the ad revenue that comes with holding the rights to NFL and NBA games. There’s also the ad-supported Freevee streaming service which the company also runs. Amazon has put in the legwork to make the free service a greater draw over time, developing new series for its catalog and putting originals like The Wheel of Time and Reacher on the platform to draw more interest.

Prime Video Is Eyeing Adding Ad-Supported Max and Paramount+ Channels

Beyond potentially adding its own ads, Amazon is also exploring the option of adding the ad-supported versions of its rivals Paramount+ and the newly-minted Max to Prime Video Channels. Last year, HBO Max became available as a channel on the service which users could sign up through, though only for an ad-free plan. If discussions with Warner Bros. Discovery and Paramount prove fruitful, however, it will now allow users to utilize the cheaper plans through Prime Video rather than having to access the other streamers directly.

Stay tuned here at Collider for more on the future of Prime Video as it eyes further implementation of ads. Check out the recently-released trailer for Season 2 of the service’s hit Good Omens below.