Amazon is planning a free, ad-supported video streaming service that looks to blow Netflix out of the water, as the company continues to find ways to outdo its biggest rival.
Amazon’s plan was outed by the New York Post, with the online retailer allegedly looking to make the service available to non-Prime subscribers, too. Amazon Instant Video, the company’s current streaming service, is only available to those who have a $99 Amazon Prime subscription fee, with it being reported that over half of Amazon’s Prime subscribers also take advantage of Instant Video. If Amazon was to separate the two and offer a free, ad-based alternative to Netflix, they could certainly make up a lot of ground on their competitors.
Wedbush Securities’ Michael Pachter certainly thinks so, with the analyst saying: “If they do an ad-supported service, they will decouple it from Prime and that is a Netflix killer.
He added: “Who wouldn’t switch if you were poor or you’re a cord-cutter?”
However, Amazon has a long way to go before they can outdo Netflix’s subscriber base. Network optimization company Sandvine stated that Netflix accounts for 34.9% of all downstream traffic in peak evening hours, while Amazon Instant Video accounts for 2.6%. While this seems like a meager sum in comparison Amazon Instant Video has seen a staggering amount of growth, with traffic more than doubling over the course of the past 18 months.
Amazon has allegedly already trialed video ads in its streaming content, though there has been no confirmation from the company in regards to when this new, free service is set to make its debut.
