Amazon (AMZN) may have more overall subscribers than Netflix, but it doesn’t boast nearly the same amount of viewers. Back in 2016, CIRP partner and co-founder Mike Levin estimated that roughly 40 percent of U.S. Amazon Prime members utilize the accompanying streaming service at least once a week, which works out to roughly 21.6 million viewers. At the time, Netflix was closing in on 50 million domestic subscribers alone. But what’s interesting is that despite the audience gap, Amazon’s streaming platform was still well-received enough to prompt analysts to call for further development.
“It appears to us that the time is right for Amazon to compete aggressively, and we believe that an Amazon standalone subscription streaming service priced below its Prime price would be well timed for a May launch,” Wedbush Securities analyst Michael Pachter said at the time.
Fast forward to today and AdAge is reporting that Amazon is “developing a free, ad-supported complement to its Prime streaming video service.” Amazon has enjoyed some successes with more niche offerings such as Transparent, The Man in the High Castle and Goliath, yet it has not been able to compete with the more zeitgeist-y shows from Netflix and Hulu (Stranger Things, The Handmaid’s Tale, etc.). That explains why they are ramping up the budget and developing more ambitious series to try and find the next Game of Thrones. It also explains why the company would consider a secondary service.
The only problem with AdAge’s report? Amazon apparently isn’t considering such a service.
“We have no plans to create a free, ad-supported version of Prime Video,” an Amazon spokesperson told the Observer.
That’s too bad because such a service might actually threaten the incumbents, at least on the surface. While Amazon may not have the watercooler content to launch such a service into the upper echelon right away, it does provide an inexpensive convenience to customers. Many consumers complain about having to pay monthly fees for multiple services. Right now, Netflix (NFLX), Hulu, Amazon and HBO Now are the big names. But within the next few years, Apple, Disney and others will join the race as well. Why not offer some counter-programming with free content?
But alas, it doesn’t look as if Amazon has any interest in such an endeavor.
