Rumor: Amazon Developing a Free, Ad-Supported Streaming Service

Rumor: Amazon Developing a Free, Ad-Supported Streaming Service

According to AdAge, Amazon may be making an ad-driven "complement" to its Prime Video streaming service. This could involve Amazon offering content creators their own channels, which it kind of does already with things like its HBO and Showtime "channels".

Amazon can often tout numbers suggesting that they have millions of subscribers to their video service, but these numbers are muddied by the fact that everyone who signs up for Amazon Prime (2-day delivery on nearly everything) comes with free access to the video catalog. There is likely to be one stark difference between the two, however.

Amazon.com, Inc. (NASDAQ:AMZN) requires a Prime membership for users to stream its treasure trove of movies, TV shows, and original series via Amazon Prime Video.

This isn't the first time Amazon has been said to be working on an ad-supported video streaming service. "A version paid for by advertisers instead of subscribers could provide a new foothold in streaming video for marketers, whose opportunities to run commercials are eroding as audiences drift away from traditional TV and toward ad-free services like Netflix and Prime". Amazon has experimented with advertisements for streaming video before.

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It's not just about getting ads in front of customers, however. In addition to directly monetizing via ads, they claim that Amazon may consider sharing both audience data and that ad revenue with content creators/studios.

"Amazon is talking about giving content creators their own channels, and sharing ad revenue in exchange for a set number of hours of content each week", says one of the executives, speaking on condition of anonymity to discuss a project that Amazon has not announced.

Meanwhile, Amazon has already begun experimenting in a limited capacity with ads (you can spot them in National Football League games) and brand integrations on Prime Video. According to AdAge's sources, payments would be "linked" to how often a show or movie is watched. If true, it would be interesting to see how this works for the company.

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