Amazon is planning to run more advertisements on its top television shows and movies on Prime Video, its streaming service.
According to a Wednesday (Oct. 2) interview in the Financial Times (FT) with Vice President of Prime Video Kelly Day, Prime is lining up new ad slots for 2025.
Day told the FT that Prime Video chose to launch a “very light ad load” earlier this year as “gentle entry into advertising that has exceeded customers’ expectations in terms of what the ad experience would be like.”
According to the FT, Amazon claimed its global ad reach hovered around 200 million, with over half of them located in the U.S.
Day also noted that customer churn had “been much, much less than we anticipated. … We haven’t really seen a groundswell of people churning out or canceling.” She also said that fewer than 20% of customers had opted to pay more for ad-free content.
Amazon is also planning to stream live news coverage of the U.S. election, as well as live sports and music events, Day told the FT. There are also plans to unveil interactive and “shoppable” ad formats for Prime Video, she added.
The streaming service’s plans for more ads next year comes as it exceeded its $1.8 billion goal for ad commitments this year.
That total includes ads on the company’s live sports telecasts, including the NFL’s Thursday Night Football, PYMNTS reported on Sept. 27.
Amazon first announced in September 2023 that it would begin including “limited advertisements” on Prime Video shows and movies, while also offering an ad-free tier at additional cost.
“We aim to have meaningfully fewer ads than linear TV and other streaming TV providers,” Amazon said when announcing the move in a blog post.
The company’s announcement came at a time when advertisements were playing a greater role in streaming. Netflix launched its ad-supported tier during the previous year.
In July, Netflix executives told investors that its ad-supported tier saw a 34% increase in membership in Q2.
Ad revenue is “growing nicely” and becoming a “more meaningful contributor to our business,” Netflix said at the time. “But building a business from scratch takes time — and coupled with the large size of our subscription revenue — we don’t expect advertising to be a primary driver of our revenue growth in 2024 or 2025.”
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