After getting a taste of ad-supported television with this fall’s live streams of Thursday Night Football, complete with commercial time-outs, Amazon has reportedly taken a serious look at a more comprehensive “freemium” version of its Prime service.
According to a report in AdAge based on unnamed sources in entertainment and advertising, the company has held talks with a range of potential content partners across the film, TV and brand landscape about an alternative to the subscription version of Prime. The move is part of an overall push into video as the company looks to keep pace with Netflix and continue its disruption of the traditional film and TV sector.
This morning, about 24 hours after the AdAge article was posted, Amazon denied it was on the ad-free path. In a statement provided to Deadline, a company spokesperson said, “We have no plans to create a free, ad-supported version of Prime Video.”
On the programming front, Amazon is enduring a profoundly rocky period marked by multiple sexual harassment allegations and other misconduct that prompted the departure of Amazon Studios chief Roy Price, which was followed by the exit of other top execs. While the management crisis came after a washout at September’s Primetime Emmys, where streaming rival Hulu took home the best drama trophy for The Handmaid’s Tale, the company’s long-term strategic compass remains pointed at Hollywood.
Prime members pay $99 a year for free shipping and discounts across Amazon, and also gain access to original shows like Transparent and The Man in the High Castle and library TV and film titles. Amazon’s video offerings are complemented by an expanding line of Fire-branded connected-TV devices and Alexa voice-recognition products.
According to one of the execs interviewed by AdAge, Amazon has considered a setup offering content creators their own channels. Creators would share in ad revenue in exchange for providing a set amount of content per week. “Amazon is taking a smart approach,” an ad agency executive told the magazine. “The only way to strike these deals is to provide a revenue share and share data insights.”
Along with subscription video players like Amazon and premium cable outlets like HBO and Showtime, Amazon is also looking to fend off tech rivals like Apple, Google and Facebook, all of which are moving aggressively into the TV space.
The stakes are not small for traditional TV networks, who rake in some $75 billion a year from advertising. Already sensing that they created a monster by taking large checks from SVOD services in exchange for streaming rights they initially undervalued, they are also battling with MVPDs over the carriage of their networks in a world of cord-shaving and re-bundling.