Amazon’s Australian ad roll-out will begin in July, will increase prices for anyone who wants to avoid them

Amazon Prime Video has revealed the date it will roll out ads on its platform to Australian customers.

From July 2, viewers who don’t want to see advertising will need to upgrade their existing subscriptions for an extra fee of $2.99 a month. Anyone who doesn’t will see ads inserted into their shows and movies before and during the play.

While the extra fee is being framed as an opt-in, it is effectively a price rise for subscribers who want to keep the same ad-free experience they are paying for now. If you do nothing, the ads will be automatically rolled out across your account.

This change will also apply to members on annual subscriptions who will need to separately pay the extra monthly fee to maintain an ad-free experience.

In an email to local customers today, Amazon justified the changes, writing “This will allow us to continue investing in compelling content and keep increasing that investment over a long period of time. We aim to have meaningfully fewer ads than linear TV and other streaming providers.”

Amazon Prime last increased prices this time last year when it jacked up its monthly plan from $6.99 to $9.99 and its annual option from $59.99 to $79.99.

It was the first bump since its Australian launch in 2018. The membership also includes shipping benefits on its shopping platform.

Amazon Prime’s ad-supported tier rolled out in the US in January and it was flagged at the time it would become the norm in several international territories later this year.

Popular Amazon Prime titles include Fallout, The Idea of You, The Boys and Reacher. Its Australian originals include Deadloch, The Lost Flowers of Alice Hart and The Test.

When streaming subscription platforms first gained popularity, one of its key differences to traditional broadcast television was it was an advertising-free zone. No spots for cars, fast food, nappies or supermarkets interrupting the flow of laugh-out-loud comedies or thrilling crime dramas.

More than a decade later and with the industry under pressure to emphasise profitability over growth, the businesses have increasingly added advertising to their revenue models.

While there were US streamers such as Hulu which already had ad-supported tiers (which often cost half the price of a standard plan), Netflix was the first global player to introduce advertising after previously saying it would not consider it.

Netflix came in with a cheaper tier for its ad-supported option rather than levying an increase on customers to avoid ads.

In its most recent financial results for the first three months of this year, Netflix reported four out of every 10 new sign-ups opted for the ad memberships in the territories where it was available.

Last week, Netflix raised the prices on its Australian subscriptions, pushing the cost of an ad-supported tier from $6.99 to $7.99 a month, a standard plan from $16.99 to $18.99 and the premium option from $22.99 to $25.99.

In October, Netflix quietly culled its cheapest no-ads plan, the former basic plan, for new customers, forcing advertising-adverse viewers onto the more costly standard plan.

Disney has also rolled out an ad tier in the US in December 2022. There, the price for the ad-supported option was the same price as existing subscriptions while those who wanted to keep their ad-free experiences saw prices increase to $US10.99 a month.

Disney is expected to introduce advertising in Australia this year.

Similarly, Paramount+ will have its ad-tier ready to go locally in June. Its plans currently cost $9.99 for a standard membership and $13.99 for the premium one. The ad tier has been priced at $6.99 a month.

Australian streaming platform Binge rolled out ads in March 2023 and was added to the existing basic plan which costs $10 a month. Those previously on the then ad-free basic plan had to upgrade to the $18 a month standard plan to not sit through ads.