With brief, occasional, italicized and sometimes gratuitous commentary…
• Today is the day. Amazon Prime members now are going to get a side dish of commercials with their videos, unless the pay an extra $2.99 a month.
The reason for the change can be found in the bottom line: Variety writes that "Morgan Stanley forecasts Prime Video ads will generate $3.3 billion in revenue in 2024 worldwide, growing to $5.2 billion in ’25 and $7.1 billion in ’26.
From the Washington Post:
"Most major streaming apps have embraced ads as another way to make money. Streaming companies claim their ad-based options as a budget-friendly way to watch, while simultaneously increasing the costs of their premium subscriptions. Apple TV is one of the few streaming services that does not offer third-party ads, yet.
"Amazon’s tack — making people pay more to get rid of the ads — could anger consumers. (Amazon founder Jeff Bezos owns The Washington Post.)
"'They’re offering no additional value and simply forcing ads on consumers,' says Mike Proulx, a research director at Forrester. 'Consumers in effect are losing out on this move, and it’s all Amazon’s gain'."
And from the Wall Street Journal analysis:
"An Amazon spokesman said the number of Prime members continues to grow, and the service’s renewal rates are high. 'Introducing ads into Prime Video will enable us to continue investing in compelling content,' he said.
"The average American household subscribed to more than four streaming services last year, nearly twice as many as five years earlier. And that comes on top of many other forms of subscriptions, from music to news to food-delivery apps.
"What’s more, streaming subscriptions have become significantly more expensive in recent months as entertainment giants raise the price of their ad-free plans—part of a push for profitability and an effort to steer more people toward their more-lucrative ad-supported tiers."
Also from the Journal:
"The company faces significant challenges as it enters a market where streaming rivals with large footprints in traditional media, such as Walt Disney and WarnerBros. Discovery, and even Netflix, a late arrival to ad sales, enjoy more established relationships with the advertisers that still spend the bulk of their money on broadcast TV. Amazon must convince the world’s largest brands, and the agencies that manage their budgets, to spend big on Prime Video despite a plethora of alternative ways to reach consumers and uncertainty regarding returns on their investments and threats to their market share."
There is nothing wrong with businesses trying to make a buck. Let's face it - that's what we're all trying to do. The real question is whether this move by Amazon reflects a broader cultural shift that is willing to diminish the customer experience, that makes the customer experience a secondary concern.
• The Washington Post reports that a new film entitled "Union" premiered at the Sundance Film Festival, documenting "Amazon workers’ tireless campaign to unionize a Staten Island warehouse … The film by directors Brett Story and Stephen Maing arrives after a banner year for the American labor movement. The success story of workers at JFK8, which in April 2022 became the first Amazon facility to unionize, no doubt inspired others.
"But organizing is rarely a smooth process, and 'Union' doesn’t shy away from exploring the thorny politics — both internal and external — of going up against one of the biggest companies in the world."
The reality, as reported by the Wall Street Journal, is that the Amazon Labor Union "is fighting to survive. Its leadership is in turmoil, and it is facing growing financial strain, according to its top officers. The group doesn’t appear close to establishing a first labor contract with Amazon, despite federal pressure on the company to bargain with workers.
"The union’s troubles since its victory in early 2022 illustrate the difficult path that grassroots organizers face. They also represent a different outcome than what activists hoped for - a wave of other warehouses following the lead set by New York workers.
"The union’s financial position is one of its most pressing obstacles. The organization is 'pretty much broke,' said Michelle Nieves, its vice president."
So, not a movie with a happy ending? Though I guess whether or not it is a happy ending sort of depends on what side of the labor line one stands.
• From The Information:
"Amazon laid off more than 30 employees working on Buy With Prime, or less than 5% of the unit’s headcount, a person close to the company said Thursday. It’s the latest in a series of cuts across Amazon over the past few months that have also affected at least 1,000 staffers in other divisions including Prime Video, Amazon Pay, Twitch and Alexa.
"Buy With Prime, which was conceived out of an internal effort to help Amazon counter Shopify that began in 2020, lets merchants offer an Amazon checkout option and Prime shipping on their own websites. Buy With Prime launched in 2022 and has been available to Shopify merchants through an integration since late last year."