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Amazon Prime Video Sued for Misleading Subscribers With New Ad Tier

Prime Video subscribers are pushing back against the Amazon-owned streamer, arguing that they have been misled following its recent move to charge an extra fee in order to watch content on the platform without ads.

On Jan. 29, Prime Video rolled out its ad-supported tier as the default for all subscribers, with those who want an ad-free experience being charged an additional $2.99 per month. Currently, Amazon Prime, which includes Prime Video, costs $14.99 per month or $139 a year. A membership that only includes Prime Video and none of the company’s shipping benefits costs $8.99 a month.

A class-action lawsuit filed in California on Friday claims that the service’s move is “unfair,” “deceptive” and “unlawful,” accusing it of committing breach of contract and violating consumer protection laws in the state for consumers who saw their subscription terms change due to the pivot.

“Instead of receiving a subscription that included ad-free streaming of TV shows and movies, they received something worth less. They cannot enjoy ad-free streaming unless they pay an extra $2.99/month,” the suit states. “Thus, Amazon’s false advertisements harm consumers by depriving them of the reasonable expectations to which they are entitled.”

The class action suit is seeking at least $5 million and a court order barring Amazon from engaging in further deceptive conduct on behalf of users who subscribed to Prime prior to Dec. 28, 2023.

A Prime Video spokesperson did not immediately return TheWrap’s request for comment.

During Amazon’s fourth quarter earnings call, CEO Andy Jassy expressed optimism that Prime Video would become a “large and profitable business,” adding that it intends to continue investing in “compelling and exclusive content” such as “Thursday Night Football” and “Lord of The Rings.”

“With the addition of ads on Prime Video, we’ll be able to continue investing meaningfully in content over time,” he added.

The latest legal action follows a separate suit from the Federal Trade Commission last year, which accused Amazon of making it difficult for consumers to unsubscribe to their Prime subscriptions by using a “manipulative” and “coercive” interface.

Pamela Chelin contributed to this report.

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