Embarking on a new era of minting money, the $1.64 trillion worth conglomerate, Amazon is set to surprise its streaming service users with an unprecedented addition to the Prime Video platform. Beginning today, commercials will infiltrate fans’ favorite TV shows and movies in the USA, UK, Germany, and Canada. This recent introduction has sparked speculation about the streamer’s ambitions. Is Amazon merely chasing Netflix’s subscriber numbers, or could it carve a unique path in the streaming landscape?

Here are some projections of the consequences of this move. Not to forget the parallels between the OTT rivals, Netflix and Amazon’s ad-free options. 

Amazon Prime vs Netflix paid models

On the surface, Prime Video’s ad-supported tier resembles Netflix’s ad-free counterpart. Unless subscribers choose to shell out an additional $2.99 per month, it will default to integrating ads into their content. The result? Morgan Stanley has predicted that ads will generate $3.3 billion in revenue in 2024 for Amazon. Going forward, the forecast suggests a growth of over $5 billion in 2025, then more than $7 billion the following year!

As for the financial aspect for Netflix users, people had been paying $4 more than the $6.99 containing ads to get the basic subscription without them. So, Netflix certainly charges more for an ad-free experience. Considering its plans to bring more licensed content onto the platform in the near future, some shifts in the fee structure are possible to allow for expansion.   

Besides this, there is another factor that sets apart Prime Video from Netflix.

How is Prime Video’s offering different from Netflix’s?

One thing to note is that Amazon Prime carries additional perks. Free shipping, music streaming, and cloud storage make the service a bundled bonus unlike the pure-play streamer, Netflix. This suggests it might not be solely focused on replicating Netflix’s success. Instead, it could be aiming to expand its Prime ecosystem to subsidize the cost of its membership, potentially leading to more content on the platform. 

Moreover, Amazon has a distinct advantage in advertising. This is obviously the biggest and most sought-after currency of the decade, data. With user information collected from its e-commerce platform, it can target ads with much more precision than Netflix, making them more relevant than those on other streaming platforms. So, those ticked off by the intrusion of ads may find some relief in this aspect. 

Do you reckon Amazon Prime’s move will cause people to favor other streaming services? Share your thoughts in the comments.