Arabella Asis Tech 02.15.2024 02:Feb AM EST

Amazon Receives Class-Action Lawsuit Over Prime Video Ads

An Amazon Prime subscriber filed a class-action lawsuit against the company's streaming platform, Prime Video, and its advertising strategy.

The lawsuit accuses Amazon of false advertisement after Prime Video made some changes to its commercials by default.

Amazon Sued for Prime Video Plan Changes

Last year, several streaming companies increased their service charge and introduced ad-tier and ad-free plans for their customers, Prime Video was one of them. Since January 29, Prime Video members should pay an additional $2.99 per month on their current plan to avoid seeing commercials.

"This is not fair, because these subscribers already paid for the ad-free version; these subscribers should not have to pay an additional $2.99/month for something that they already paid for," the lawsuit stated.

The case was filed on behalf of an Eastvale, California resident, Wilbert Napoleon, who claims to be a Prime member. The lawsuit seeks to bring a case for himself and all other Amazon Prime customers who paid for annual membership before December 28 of last year.

In addition, the lawsuit also called Amazon's conduct "immoral, unethical, oppressive, unscrupulous and substantially injurious to consumers."

Amazon Introduces Ad-Free Plans

During Amazon's fourth-quarter 2023 earnings call, CEO Andy Jassy explained that the adoption of ads in Prime Video is a sign of investment to bring more content to the platform in the future.

"We have increasing conviction that Prime Video can be a large and profitable business on its own, and we'll continue to invest in compelling exclusive content for Prime members like 'Thursday Night Football,' 'Lord of the Rings,' 'Reacher,' 'Mr. & Mr. Smith,' 'Citadel' and more," Jassy stated.

According to some analysts, Prime Video is expected to gain more than $3 billion in revenue this 2024 for its advertising strategy.

As for other companies, Netflix and Disney+ have already introduced ad-tier plans. However, these were newly added plans and did not coincide with the existing plans or were made as a default option compared to Prime Video.