The tech world lit up with news that Amazon was preparing to release an ad-supported version of its Instant Video collection. The e-commerce company is attempting to douse that fire, stating that it hasn't announced any plans to release a free version of Amazon Instant Video but it is failing to assert the reports are false.
An Amazon spokesperson reminded everyone that the company offers the first episodes of select series for free, supporting the content by serving up ads. The spokesperson also said that Amazon uses ads on some of it trailers, but would only say that the company hasn't announced plans for an ad-supported service that's similar to Hulu's free version.
"We're often experimenting with new offers and experiences for customers, but we have not announced any plans to offer an ad-supported video-streaming service," stated an Amazon spokesperson.
It's a subtle change in tone from statements an Amazon representative released back in March, when Amazon representatives were stating that the company had no plans to release a free version of any of its streaming-media services. Now Amazon is merely expressing the obvious in stating that it hasn't announced anything about an ad-supported version of the Instant Video collection.
Expanding its offerings of free content, if enduring loud ads counts as free, would help Amazon make up some of the ground between itself and Netflix. While Amazon's Instant Video collection ranks second in the U.S. in terms of traffic during peak hours, Netflix draws the lion's share of prime time attention by attracting about 34.89 percent of web traffic during the busiest periods of the day. Amazon's service attracts approximately 2.58 percent during that time.
Reports of Amazon's alleged plans to release an ad-supported version of the e-commerce company's streaming-video service were revealed by sources who spoke with the New York Post. While the sources didn't state that the ad-supported service would be free, the subscription would have to be significantly lower than Netflix's $9.99 per month rate, and Hulu already uses ads to erase the price tag for consumers.
Michael Pachter, an analyst at Wedbush Securities, thinks Amazon will spin the ad-supported and premium versions of its Instant Video collection outside its $99 Prime service, creating a "Netflix killer."
"It won't be $99 a year," said Patcher before adding: "Who wouldn't switch if you were poor or you're a cord-cutter?"