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Of course, Amazon is planning an ad-supported video app. Why not?

Of course, Amazon is planning an ad-supported video app. Why not?
[Photo: Steve Johnson/Unsplash]

Amazon’s advertising business hit $2.2 billion in revenue last quarter. It’s the global giant’s fastest-growing segment, at 132% year over year, compared to the company’s overall rate of 39%. Now there are reports that the company is planning to launch a new free, ad-supported video app to further boost its ad business by preying on the $70 billion TV advertising market.

The Information reports that the new service is tentatively called Free Dive, and the company is in talks with studios to license the rights for old TV shows. The company already has ad-supported shows on IMDb, has expanded video ads on Twitch, and runs ads during NFL games on Prime Video. It’s also expected to run ads on Prime Video in Europe for some sports broadcasts that it acquired rights to such as US Open tennis and some Premier League soccer games.

Of course Amazon is doing this. Why not? It has a thriving content business, the technology, and the brand relationships–the money is there for Amazon to take, especially if it can connect the dots between video ads and its exhaustive sales data. As Media Kitchen media buyer Andrew Sandoval told the Information, “Amazon has very good data and if I could track back sales activity to the actual Amazon account and target those people, it would be very powerful.”

Brands and agencies are already tossing more money Amazon’s way as it has expanded its ability for them to buy ads programmatically across its platform. This is yet another way for viewers to not only, say, see detergent ads between episodes of Small Wonder, but also for Amazon to continue its push to gain on Facebook and Google’s digital ad duopoly.

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