Amazon CEO Scrutinizing Costs for Prime Video Productions; Are Content Cuts on the Way?
The streaming landscape at Amazon is evolving. Recent reports indicate that the company is getting ready to launch an ad-supported tier of Prime Video, in order to provide users with a lower-cost option and help Amazon more efficiently monetize its subscribers.
Ahead of that move, Amazon is turning a watchful eye toward its Hollywood studio. That’s according to Bloomberg's Lucas Shaw, who reports that amidst a company-wide cost-cutting initiative that will eliminate 27,000 jobs, Amazon’s CEO Andy Jassy is meeting with executives to pinpoint why costs are spiraling and hits have been few and far between.
Only Netflix and Disney+ spend more on original programming than Prime Video does, but recent series like “Daisy Jones and the Six” and “The Power” have not brought in the viewership that Amazon was hoping for. “Citadel” has also been disappointing for Amazon, cracking Nielsen’s top-10 streaming series list just once. The company intended for “Citadel” to become an international franchise with several spinoff series, but that plan might be under consideration thanks to the company’s cost-saving plans.
Even “The Lord of the Rings: The Rings of Power,” which brought a record-breaking audience to Prime Video when it first debuted had trouble retaining those viewers through the end of the first season. Season 1 of “Rings of Power” was reportedly the most expensive TV series ever made, meaning that Amazon is counting on Season 2 to bring better-sustained ratings in order to make the investment worthwhile. As Amazon prepares to slash jobs to improve its bottom line, audiences must wonder if a content cull like those underway at Paramount and Disney is in store for Amazon’s streamers.
It’s hard to say for sure, but content cuts are a tried and true method of shrinking a company’s streaming deficits. Warner Bros. Discovery showed the industry the way last summer, and Disney followed suit starting in May. Paramount began its latest round of content removals at Paramount+ in June, and it may be weeks before the streamer is done purging shows and movies from its library.
Still, Amazon brought in $500 billion in sales last year, so the company’s financial situation is a bit different from most other companies that operate streaming services. Its $7 billion content spend for Prime Video is a comparative drop in the bucket, though that doesn’t mean producers and showrunners are escaping financial scrutiny. Content cuts might not be immediate at Prime Video, but they’re certainly on the table if the service can’t get its spending under control.
Amazon Prime Video
Amazon Prime Video is a subscription video streaming service that includes on-demand access to 10,000+ movies, TV shows, and Prime Originals like “The Lord of the Rings: The Rings of Power,” “Jack Ryan,” “The Marvelous Mrs. Maisel,” “The Boys,” and more. Subscribers can also add third-party services like Max, Showtime, STARZ, and dozens more with Amazon Prime Video Channels. Prime Video also offers exclusive live access to NFL Thursday Night Football.