Hub Research: U.S. Streamers are Shifting to Ad-Supported Tiers

Prime Video’s launch of an ad tier had “an immediate and dramatic impact” on the ad-supported streaming ecosystem in the U.S., according to Hub Entertainment Research.

Per Hub, those using only ad-supported options increased ten percentage points since Q4 of last year, while the group who watch only ad-free was down by nine ten percentage points. The findings were revealed in Hub’s quarterly TV Churn Tracker.

Prime Video implemented a default ad-supported tier at the start of this year. Hub indicates that 85 percent of respondents who know which tier they’re on use the ad-supported tier, ahead of Peacock’s 80 percent and Hulu’s 69 percent. In contrast, this number is just 22 percent for Netflix and 26 percent for Max.

“By defaulting viewers to the ad-supported service, Amazon Prime Video has hurdled into the lead in share of ad-supported subscriptions,” Hub reports. Further, “there is no evidence that putting subscribers on an ad-supported tier has resulted in a backlash.”

“Virtually overnight, Amazon Prime Video dramatically transformed the video advertising ecosystem,” said Mark Loughney, senior consultant to Hub. “Suddenly advertisers have the ability to reach tens of millions of viewers on one platform, with robust targeting capabilities and a vast retail capability. Amazon has immediately launched themselves into ‘must buy’ territory for advertisers and media agencies.”