- Leaked documents obtained by Reuters give us some new insight into how Amazon Prime Video helps Amazon’s bottom line.
- Viewership for Amazon’s video content is at about half of what Netflix has for subscribers.
- Amazon’s original shows get people to sign up for Amazon Prime, netting the company massive profits.
This week, Reuters nabbed some leaked documents relating to Amazon Prime Video subscriber data. While Netflix, the reigning king of video streaming services, publishes subscriber data from time-to-time, Amazon has never released figures for its total audience, nor has it published other data that appears in the leak.
According to Reuters’ interpretation of the source data, Amazon Prime Video has about 26 million viewers in the U.S., which is roughly half the U.S. subscriber base of Netflix. That number includes the viewership of all video programming on Prime, including the non-original content Amazon licenses from other companies.
The documents also reveal that Amazon pays close attention to which shows generate the most Prime membership subscriptions. For example, The Man in the High Castle, easily one of the most expensive original shows in Amazon’s roster at about $72 million in production and marketing, led to about 1.15 million new subscriptions.
Amazon refers to this as the “cost per first stream.” The company looks at which shows generate the most subscriptions when a viewer first watches an episode. For example, a non-Prime subscriber logs on to watch the first episode of The Man in the High Castle, and then says, “Hmmm, alternative Nazi history shows are cool… I’ll sign up for this!” Amazon then tallies all the viewers in that category and divides it by the cost to produce the content, which gives a dollar-value to every program.
If that’s confusing, think of it this way: The Man in the High Castle cost Amazon $72 million, but 1.15 million people subscribed to Prime after watching an episode. If we assume all those people signed up for the basic $99-per-year membership, the show cost Amazon $63 per subscriber, which means the show earned Amazon a 36% ROI. That’s not bad at all.
Of course, that doesn’t even take into account the fact that once a person signs up for Prime, they are more likely to buy more products from Amazon. With that in mind, Amazon’s original video content is making it money hand-over-fist.
Unsurprisingly, The Grand Tour, which is essentially Top Gear but not on the BBC, earned Amazon the most subscribers. But Bosch is doing really well and so is Hand of God, which is interesting because Amazon canceled that one. Check out the chart above to see where your favorite show lands.
March 17, 2018 at 01:23AM