Watch out, YouTube, Amazon's driving subscription revenue for video creators

By Sahil Patel

One subscription to rule them all. That’s the idea behind Amazon’s Video Direct program, which allows publishers of all stripes to distribute content through the e-commerce giant’s video platform. Initially, though, the program is attracting mostly smaller, niche video publishers, which claim that the program is actually contributing to their bottom line — something that YouTube and other video rivals should keep an eye on.

Publishers in the Video Direct program, which launched in May, have multiple options in how they want to distribute their content: They can sell “add-on” subscriptions, make individual titles available for purchase or rent, deliver content to Amazon’s Prime Video subscription streaming service, or make videos available for free on Amazon’s ad-supported video hub. This move came several months after Amazon launched add-on subscriptions with publishers like Showtime, Starz and Lifetime.

Several publishers that have elected to sell add-on subscriptions — selling their streaming services for a monthly price on top of Prime Video’s $8.99-per-month charge — said Amazon now accounts for a healthy percentage of overall subscribers. One publisher said Amazon subscriptions account for nearly 30 percent of total subscribers for its streaming service, which number  in the “low six figures” overall. For another niche streaming service, Amazon subscriptions account for more than 40 percent of overall subscribers.

Since launching its $5.99-per-month Motor Trend On Demand service on Amazon on July 28, Motor Trend has seen streaming video subscribers grow by 20 percent, said Jonathan Anastas, CMO of Motor Trend’s parent company, TEN.

“We didn’t know what to expect, but we’ve been pleasantly surprised by it,” said one Amazon subscription partner. “The question for the long term is: Are there millions of potential subscribers here, or will it remain a niche play? I don’t think that’s been determined yet.”

On its add-on subscriptions page, Amazon offers access to dozens of publishers. The list includes services from premium cable networks Showtime and Starz, which are essentially carbon copies of what’s available on their TV channels. Most of the list, however, is full of niche streaming services from TV networks like A&E and AMC and digital publishers like Cheddar and Tastemade.

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