Amazon CEO Jeff Bezos claimed that Prime Video, which launched 10 years ago, saw more than 175 million Prime members stream shows and movies in the past year.
It’s an impressive total, especially considering that Amazon Prime just recently crossed the 200-million-member mark. Amazon said it had 150 million Prime members in January 2020. Consumer Intelligence Research Partners estimated that as of December 31, 2020, Amazon had 142 million Prime members in the U.S.
Dave Fildes, director of investor relations for Amazon, fielded a question this week about the seemingly high rate of Prime Video engagement (approximately 7 out of 8 members) by reiterating the service’s purpose as an acquisition and retention tool.
“It's a significant acquisition channel in Prime countries. And that we look at it and see that members who watch video have higher free trial conversion rates, higher renewal rates, higher overall engagement,” he said, according to a Motley Fool earnings transcript. He added that Amazon expects to continue growing content spend on an absolute basis and to invest in that beyond original content.
Amazon Prime Video has continued to expand its roster of live sports content and earlier this year the company reached a deal with the NFL to exclusively stream Thursday Night Football.
Amazon is reportedly paying $1 billion per year for its 11-year agreement (that runs through 2033) with the NFL, another contributing factor to the company’s rapidly growing content budget. Amazon revealed earlier this month that it spent $11 billion on streaming video and music content in 2020, up from $7.8 billion in 2019. According to CNBC, that money goes toward licensing and production costs along with costs associated with digital subscriptions and sold or rented content.
That huge investment in content appears to be paying off for Amazon in terms of engagement and prestige. Bezos said streaming hours are up more than 70% year over year before going on to tout Amazon Studios’ recent Academy Award nominations and two wins.