Update November 14th, 11:06AM ET: This article was updated to include a statement from Amazon denying the claims.
Amazon is reportedly working on a free, ad-supported version of its Prime video streaming service, according to sources that spoke with AdAge. Currently, Prime members pay $99 to access a variety of video streaming content, which is usually ad-free.
This alternate version described by AdAge would be available to non-Prime members and would be supported by the advertisers. AdAge says Amazon may also share audience information and ad revenue in order to bolster its initial efforts with the project. One unnamed executive told AdAge that "Amazon is talking about giving content creators their own channels, and sharing ad revenue in exchange for a set number of hours of content each week."
People have been migrating away from traditional TV and toward subscription-based services like Netflix, in part because these platforms offer ad-free experiences. This version of ad-supported streaming will certainly be attractive to advertisers and content creators, but the question is whether consumers will bite on watching shows interrupted with commercial breaks, even if they’re free.
A “freemium model” could be beneficial to Amazon as movies and TV shows are one of the main reasons people sign up for Prime accounts. So sure, a free version is a good deal, but freemium could drive people to upgrade to a Prime account to access ad-free streaming, along with all the other benefits Prime offers, like free two-day shipping on eligible purchases.
According to AdAge, the free, ad-supported version will feature a lot of back catalog from Amazon, including children’s programming as well as lifestyle shows that revolve around topics like cooking and travel.
Despite all the details, however, an Amazon spokesperson told The Verge: “We have no plans to create a free, ad-supported version of Prime Video.”