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On January 29th, Amazon started running ads with its video-on-demand Prime Video streaming service. As announced in September 2023, Prime subscribers must pay an extra $3 a month to watch ad-free.

Most of the major streaming services already offer a less expensive ad-supported tier for viewers who don't want to pay for the ad-free services that have gone up in price this past year. In contrast, Amazon added commercials to its basic subscription and gives subscribers the option to pay more if they don't want to watch commercials.

As the cost of an Amazon Prime membership has continued to rise over the past few years, the extra charge approach is a way for Amazon to claim in its blog, "We're not making changes in 2024 to the current price of Prime membership."

Amazon Prime membership runs $139 annually or $15 a month. Students have a reduced rate of $69 or $7.50 a month. Users on government assistance like EBT or Medicaid can pay $7 a month for up to four years. The ad-free option costs $3 on top of those prices.

Of course, an Amazon Prime membership includes several benefits that go well beyond video, including free two-day delivery, discounts at Whole Foods and Amazon Fresh Stores, Music Prime (but not Unlimited), Prime gaming, unlimited full-resolution photos storage, prime reading (borrow books and magazines), medical and prescription services and savings, a free year of Grubhub+ delivery, and Prime Video.

The video entertainment portion of an Amazon Prime membership has been “free” since the company first offered streaming video in 2006 with Amazon Unbox. It was renamed Amazon Instant Video on Demand in 2008. In 2011, the service added unlimited streaming of over 5,000 movies and TV shows and became Amazon Prime Video in 2016. "Amazon" was dropped from the name in 2022.

Prime Video offers a stand-alone subscription for those who don't want to sign up for an Amazon Prime membership but it costs $12 — $9 a month for Prime Video plus $3 to go ad-free — which raises a question: Is the service worth $12 if you aren't an Amazon Prime customer?

In 2015, Amazon CEO Jeff Bezos explained his strategy for choosing original content to the Hollywood Reporter: "If you say, 'Let's hire the world's greatest storytellers. Let's encourage them to take risks,' then you're going to end up with a remarkable story, and remarkable stories always find an audience."

The strategy has apparently worked.

Amazon Originals were nominated for 41 Primetime Emmy Awards in 2023 with nods going to Daisy Jones & The Six and six nominations for The Lord of the Rings: The Rings of Power. The Marvelous Mrs. Maisel added 14 nominations in its final season for a total of 80 Emmy nominations in its five seasons.

In the company’s official blog, Amazon says the $3 price hike (for viewers who don’t want to see commercials) will enable it "to continue investing in compelling content and keep increasing that investment over a long period of time."

According to a recent article in Variety, Morgan Stanley is forecasting that Prime Video ads will bring in an additional $3.3 billion in worldwide revenue in 2024, rising to $5.2 billion in 2025 and $7.1 billion in 2026. Interestingly, a survey cited in the article suggests than fewer than 10% of Prime Video subscribers are willing to pay the extra $3 a month, perhaps because the average ad load is limited to 2-1/2 to 3-1/2 minutes per hour — a minimal disturbance compared with the 18 minutes of commercials you get per hour on average with broadcast TV.

How to Subscribe to Ad-Free Prime Video
If you have a Prime membership and didn't get a message asking you to upgrade when you opened Prime Video, or if you've changed your mind and want to pay up to eliminate commercials, you can subscribe to the ad-free version of the service on amazon.com.

• Go to Account & Settings and select Your Account.
• Select Go Ad Free
• Select Start Subscription

Or you can upgrade in the Prime Video app on your device:

• Go to Settings and select Prime
• Select Go Ad Free
• Select Start Subscription

Of course, if you don't mind the commercials, you don't need to do anything — ads will show up as soon as you start watching. One thing to keep in mind if at some point you decide to get rid of commercials: Sports and other live events will continue to carry advertising.