Media Companies Are Discovering What Creators Have Known From the Beginning

Hands pointing at tv with amazon prime on the screen
KsanderDN/Shutterstock – Yuri A/Shutterstock Amazon Remix: Linzi Silverman

Amazon started running ads on Prime Video this week. This makes Apple TV+ the only major US streaming service without a lower-cost or free ad-supported plan, and they may very well be getting them soon, too. In an extra-aggressive step, Amazon put all current Prime Video subscribers automatically on the ad-supported tier. If you want to opt back out of commercial breaks, that costs an extra $3 per month. 

It’s a bold step, and even though Amazon vows that the extra revenue is going to go right back into making great original content for Prime Video, not everyone on the company’s current roster of creative talent seems totally on board with the concept. In fact, two prominent Amazon Prime Video showrunners voiced grievances with the change to The Hollywood Reporter on Wednesday.

“Expats” creator Lulu Wang – best known to date for her breakthrough indie drama “The Farewell” – told THR that she’s “very angry” about Amazon declining to tell her about ads coming to Prime Video while the series was in production. She claims she only found out the content would be interrupted by ad breaks after the show was already produced, preventing her from baking in natural pauses for commercial messages while she was putting the show together.

Co-creator Francesca Sloane’s spy comedy series “Mr. & Mrs. Smith” hits Prime Video on February 2, and will be the first high-profile series to debut alongside ads. She was taking the whole thing less personally than Wang, but nonetheless told THR that she hopes the ads “[don’t] create too big of a disruption.”

Several other non-Amazon affiliated showrunners also spoke to THR for the piece, including “Nine Perfect Strangers” vet David E. Kelley, who said he felt the experience of watching the show with commercials “was horrible.” (Kelley compares it to serving a pie vs. pudding. You can easily come up with ways to slice and serve pie, but that doesn’t work for every dessert option.) 

The complaints also aren’t limited to the ad’s potential for disrupting the viewing experience. For “Tokyo Vice” executive producer Alan Poul, the removal of advertising from subscription streaming services “was one of the biggest steps in bringing the worlds of TV and film closer together.” For him, in some unspoken way, not having ads made shows on Max, Netflix, and similar services inherently made them more cinematic, and add a sense of importance and even grandeur.

There’s some obvious truth behind what these creatives have to say, of course. It seems obvious that Amazon made a bit of a blunder in not working more closely with its creative teams, ensuring at least that the first premiere batch of new Prime Video shows would arrive with native, organic ad breaks rather than random interruptions.

Having said that, for long-time creators, advertising is not just a part of life, but an essential component of the content creation process. Revenue-sharing agreements with streaming and social media platforms are the lifeblood of the creator economy, enabling new entrants to start earning money, even as they gradually grow their audiences over time. Some kind of theoretical economic model that allows a newcomer to immediately spread the word about their videos and amass enough subscribers to fund their work sounds terrific but has yet to actually be devised. (The patronage system worked quite effectively in the Renaissance and generated a wide variety of beautiful art. It’s just not entirely compatible with the digital world of entertainment in 2024.)

After a decade-plus of streaming platforms attempting to fund their entire operations via subscriptions, legacy studios and media companies have discovered what internet creators have known essentially this entire time. The most effective model of all is actually recurring subscription or support from dedicated followers, supplemented by advertising. 

It’s just like the “Freemium” concept in the world of apps. You want some kind of easily-accessible free option of the product available, for marketing purposes. That’s how people will find new creators, shows, films, songs, or whatever that interest them, and get them engaged. As Peacock has discovered, generating tons of well-reviewed and likable series that no one has access to watch, it’s almost impossible to build a large, passionate fanbase behind a firewall. (They’ve started selling off their best shows to Netflix so people can actually see them.) Making content free to watch, and serving ads alongside it, accomplishes both goals at once. It brings in some revenue, while also getting a lot of people’s attention for no money down.

But once you’ve started to amass not just followers but fans in significant numbers, there are additional ways to monetize their passionate interest. That’s when you can start selling subscriptions, promoting Kickstarters, writing books, hawking merch, and so forth.

The logo of the MGM film studio, which Amazon grabbed for $8.45 billion in 2021, once read, in Latin, “Ars Gratia Artis.” Amazon has since updated the logo with the phrase’s English translation: “Art for Arts Sake.” But this shouldn’t be read as an endorsement of that worldview.

Regardless of how showrunners may or may not feel, none of our leading streaming platforms or apps are making content for its own sake, and most of the users and creators developing content for these platforms likely feel the same way. Being a YouTuber or an influencer or a livestreamer may have just been a lark at first, and a hobby for some, but for millions of people around the globe, it’s first and foremost a business.

Consumers have long embraced the mixed subscription-with-advertising model, and in many cases, seem unwilling to spend a few more dollars on an ad-free subscription. The ad-supported streaming space is booming, with free services like Amazon’s Freevee, Paramount’s Pluto TV, Fox’s Tubi, and the Roku Channel expanding in most cases faster than their paid subscription-based rivals. According to a 2023 Samba TV survey, 1 in 3 US streaming TV viewers currently subscribe to at least one free service.

So it’s a bit odd to read “Ally McBeal” veteran David E. Kelley complain about his shows being occasionally poised for these messages from, say, L’Oreal or what have you. That’s a small price to pay for getting to adapt a book you love with Nicole Kidman, no? In a world where TikTok is plotting Los Angeles warehouse studios so influencers can have a chance to hawk merch on an industrial scale, like they do in Shenzhen China, such complaints can feel a bit churlish. Amid a “journalism bloodbath,” in which massive media companies terminate actual humans in the distant, vague hope that maybe one day ChatGPT can take over for them, it seems almost alien to feel too resentful of ads. Hey, they can be annoying. They might not be entirely relevant to you. But they, in a very real way, keep the lights on.

Content for Creators.

News, tips, and tricks delivered to your inbox twice a week.

Newsletter Signup

Top Stories