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How Does Amazon Make Money On Prime Video

This article will discuss how Amazon makes money off prime video and how the Amazon prime subscription service works. Prime members pay $99 a year for Prime.

With that in mind, this post is all about why Amazon Prime is worth the subscription fee. Amazon Prime membership gives you free 2-day shipping, video streaming, and a few other exclusive perks.

When you’re shopping for videos on amazon, you’re looking at the top two free offerings: Amazon Prime Video and Amazon Prime Now.

Both of these top picks are free and offer the full lineup of Prime video content. However, if you want more popular, top-rated, and unique content, then you have to pay a monthly or yearly fee for Amazon Prime.

In this post, we’re going to cover Amazon Prime membership and how Amazon makes money on prime video.

Amazon Prime fees start at $7.99/month for Amazon’s standard service and $10.99/month for Amazon Prime Video. That’s the standard cost of Amazon Prime for the “free” offerings.

The $10.99/month option is called Amazon Prime Video. You can see in the chart below, that the $10.99/month tier is a decrease in price from the previous $14.99/month.

We’re taking a closer look at the $10.99 tier because that’s the one you probably have the option to choose from when you’re shopping for videos on amazon.

When you choose that option, you also have to pay a subscription fee on top of the Amazon Prime membership fee.

Content subscriptions cost $8.99

Stock photo of the Business Man with a credit card by rupixen

Subscription fees are paid every month, with the option to pay all at once or spread out. Here are the breakdowns:

As of this writing, there is a slight increase from last month. Instead of charging $10.99/month for the Amazon Prime Video subscription service, the company has upped the price to $10.99/month.

That’s still cheaper than HBO and Starz’s standalone subscription services, and certainly an option for cord-cutters or folks that don’t subscribe to cable television.

Because Amazon Prime Video is the top choice for Amazon Prime subscribers, it stands to reason that it’s where most of the money from Amazon Prime goes.

For each month, the first graph shows revenue from Amazon Prime subscription service, and then the second shows where it gets invested. The orange line shows how the Amazon Prime subscription service makes money.

The increase in monthly revenue is good news, especially since that increase is relatively small. If Amazon Prime Video can keep up this pace, I’d expect to see an even greater increase in money coming into the company as well.

Streaming content is more popular on Amazon Prime Video

Amazon Go

One of the biggest questions, when you think about Amazon Prime, is whether or not Amazon has any plans to cut into Netflix’s customer base.

While there are a few studios on Prime Video, the streaming service has found a niche with offering unique and popular content.

As Amazon Prime is an exclusive subscription service for Amazon, it offers some exclusives that Netflix doesn’t, such as the “Lord of the Rings” movies.

For the last few years, Amazon has been working on its own Netflix competitor. Amazon Prime Video is the video service on Amazon's Prime subscription service.

While Netflix and Hulu have millions of subscribers, Amazon has yet to get there.

Since Amazon is still very much a start-up, it has been a good year for them, but not great.

So far Amazon's competitors are performing better than expected. Hulu just had its highest revenue since its founding in 2007. Amazon has been struggling to bring in new members.

Still, Amazon's competition hasn't scared them away from competing and that may be a bad sign. Regardless of which service takes the lead, we may just be entering the golden age of streaming media.

Who is Amazon Prime Video for

Man at a laptop in an office

Amazon Prime Video is a video streaming service for Amazon Prime subscribers. Netflix, Hulu, and HBO offer streaming services that cater to individual consumers.

This may be why many people sign up for these services. This article will discuss why many people are hesitant to subscribe to Amazon Prime.

Subscribers have strong preferences that differentiate these services from each other. For example, Netflix subscribers are highly selective when it comes to the shows they watch.

Their shows are typically only available on Netflix, as a service to subscribers, and so far, none of their shows are available on other services.

Hulu subscribers, on the other hand, are more common. Hulu's shows are available on other services like Netflix and HBO GO.

Even more importantly, their shows are available on all the other major streaming services like YouTube, Hulu Plus, Sling TV, and DirecTV Now.

Amazon Prime subscribers will likely be looking for another service.

Given the above, Amazon needs to take a few steps to convince people to sign up for Amazon Prime Video. It is first necessary to create content that is unique to Amazon.

This would be an unusual move for Amazon, but it is worth considering given the above.

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