Amazon demands 30pc of ad revenue from TV networks’ apps
Amazon has given major broadcasters three weeks’ notice that it will demand a 30 per cent cut of revenue from all advertising that runs while someone watches their programming through its Fire TV devices.
But the major television networks have accused the tech giant of a “cash grab” and “rent-seeking”. The new terms would force broadcasters to pay millions of dollars to have their content included on Fire TV – USB or set-top box devices that allow access to internet streaming software.
Senior network sources said they were already considering pulling out of Amazon Fire TV as a result.
Under Fire TV’s new terms of service, the owners of apps used for more than 30,000 hours per month in total “must… provide Amazon with 30 per cent of all revenue received for any advertising in the Fire TV Ad-Enabled App”.
An image of the Amazon Fire TV Cube, one of Amazon’s connected TV devices.
The free-to-air networks – Seven, Nine, Ten and SBS – have pushed the government to bring in new laws which mandate that their apps are pre-downloaded and prominently positioned on new televisions and on plug-in streaming devices like Fire TV and Google’s Chromecast. Nine is owned by Nine Entertainment, the publisher of The Australian Financial Review.
Bridget Fair, the chief executive of the industry’s lobby group, Free TV, said it amounted to a sudden “cash grab”.
“It’s simply outrageous that with so little notice, a player like Amazon can turn around to the local TV industry and demand a whopping 30 per cent of advertising revenue sold by broadcasters in their own apps,” she said.
“This is money that otherwise goes to investing in local content like trusted news, entertainment, Australian drama and live and free sport. We simply can’t allow
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