Amazon Prime Video to Charge Extra for Ad-Free Viewing
Amazon Prime Video viewers seeking to avoid ads during shows and movies will have to pay an extra $2.99 per month starting in late January.
The ad-free tier will officially roll out Jan. 29 and come on top of the $139 annual cost of an Amazon Prime subscription, or the $8.99-a-month standalone Amazon Prime Video subscription.
That means users who choose not to pay the extra fee to go ad-free will start seeing commercials on Prime Video content starting on the same date.
Amazon previously announced its intention to show ads on Prime Video in September, though it said it hoped to show “meaningfully fewer ads than linear TV and other streaming TV providers.”
Here is how various streaming services will compare once Amazon’s new fee kicks in:
Amazon Prime Video Ad-Free (standalone): $10.99 a month
Amazon Prime Video Ad-Free (with Prime subscription): $16.99 a month
Netflix Standard: $15.49 a month
Disney+ Ad-Free: $13.99 a month
Hulu Ad-Free: $17.99 a month
NBCUniversal’s Peacock: $11.99 a month
Max: $15.99 a month
Advertising has taken a growing share of Amazon’s business, and now comprises more than 8% of the company’s total net sales, according to the company’s financial statements. Advertising income surpassed income from subscription services in 2022, the statements show.
Meanwhile, Amazon indicated it continues to suffer net losses from licensing and distribution of video content. Those losses are emblematic of the industry-wide struggle to come up with a viable financial model for streaming, and a key reason why many streaming platforms have raised their prices.
The announcement comes amid a surge in the streaming market and is sure to raise questions about the future of ad-free viewing and subscription pricing. Stay tuned for updates as this story unfolds.
Rob Wile is a breaking business news reporter for NBC News Digital.