It was still an exception in the land of streaming. This will soon no longer be the case. After Netflix, Disney, Max (HBO), Peacok, Hulu, etc. Amazon, in turn, gives in to the lure of advertising. The American giant announced Friday morning that its Prime Video service would broadcast advertisements from 2024.
These will appear in the United States, the United Kingdom, Germany and Canada at the start of the year. Then they will arrive in France, Italy, Spain, Australia and Mexico later in the year. The measure should make it possible to continue “investing in compelling content and continue to increase this investment over the long term,” the company said on its website.
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The e-commerce giant's modus operandi will consist of inserting advertising breaks into the existing Prime Video package, while at the same time offering subscribers to pay more for an ad-free alternative. Across the Atlantic, you will have to pay an additional 3 dollars to avoid advertisements between two episodes of Lord of the Rings, The Fabulous Mrs. Maisel or Jack Ryan.
“Amazon's strategy is interesting: by switching all Prime Video subscribers to the advertising-supported offer, Amazon will be able to have a massive audience to market from the start,” notes Philippe Bailly, president of the NPA Conseils firm. . Unlike Netflix, whose new offering with advertising started from scratch.
Amazon is already firmly established in the advertising market. In 2022, the company generated $38 billion in advertising revenue. A drop in the ocean compared to the 500 billion dollars in turnover recorded last year. But these revenues already exceed those from Prime subscriptions. Proof that the segment is dynamic, in the second quarter, advertising revenue reached $10.7 billion, up 22% compared to the same period last year.
The behemoth also has in-depth knowledge of its users. It therefore has the possibility of offering more qualified advertisements, which could be perceived as less intrusive by the consumer. But isn't the latter, who had abandoned television channels and its advertising tunnels, at risk of fleeing again? Amazon took the lead by indicating that it would introduce a limited number of advertisements. “We plan to broadcast significantly fewer advertisements than linear television and other streaming television providers,” he reassured.
“If it does not exceed four to five minutes of ads per hour, which is roughly the norm for subscription video-on-demand services, the user experience will not really be degraded,” believes the boss. of NPA Conseils. This remains acceptable: it is two to three times less than the advertising volume on television channels in Europe and four times less than on the antennas of American broadcasters. »
Viewers will have to get used to it. “Streaming offers with advertising were an exception. They are becoming the new standard in the video-on-demand market,” observes Philippe Bailly. The new world definitely has an air of déjà vu.