Amazon developing free, ad-supported video streaming service, report claims
The New York Post is reporting that Amazon is developing a media streaming service that will be separate of its Amazon Prime throw-in Instant Video. The big difference is that it will be supported by ads, rather than your money. Back in March of this year, the Wall Street Journal reported the same service, but Amazon denied anything like that was in development. With another source joining the fray, the report carries some steam, and a free streaming service could help bolster the set-top Fire TV and recently revealed Chromecast-like Fire TV Stick.
Amazon Fire TV
A free media streaming service could help the appeal of the Amazon Fire TV.
Of course, the service wouldn’t just have all of the Instant’s best offerings. Instead, it would act like something of a demo — offering quality content, but intentionally dangling better content behind the Amazon Prime subscription, hoping that the free taste creates a hunger for more. Netflix, Amazon’s main streaming video competitor, has around 33 million domestic subscribers. Amazon doesn’t release Prime subscriber numbers, but the service is estimated to have around 50 million subscribers, and half that number is estimated to use Instant Video, trailing Netflix by around eight million. Even if customers don’t upgrade to Prime for the video streaming, having the ad-supported service would, in theory, at least increase Amazon’s video streaming market share — it’s better to have non-paying eyeballs looking at your ads than looking at a competitor’s service.
Currently, Amazon allows non-Prime users to stream certain videos for free, but they have commercial breaks, similar to Hulu’s free option. It’s entirely possible that this limited service proved effective at getting customers to pony up a Prime subscription, and nudged Amazon to try it on a larger scale. The ads likely wouldn’t turn customers away from trying out the service if it were free, especially considering paying cable subscribers have to deal with commercials anyway.
According to the report, the free, ad-supported service will be available sometime early next year.