Government ‘concerned’ about Amazon plans to take 30pc cut of ads

afr.com:

The Albanese government says that it is “concerned” about plans detailed by Amazon to demand a 30 per cent cut of advertising when major broadcasters provide programming through its Fire TV streaming device.

The Australian Financial Review last week reported that Amazon had given the major broadcasters three weeks’ notice of the change, with television networks accusing the tech giant of a “cash grab” and “rent-seeking”.

The global policy was published in June, but the Seven Network, Nine Network, Network Ten and SBS were only told of the change in the past two weeks. Amazon did not dispute that its policy applied to the major media companies, and said it needed the revenue to improve its devices.

“Free-to-air broadcasting services play a crucial role in supporting our sense of cultural identity and informing and entertaining all Australians”: Minister for Communications Michelle Rowland. 

“Our commercial terms allow us to invest in the Fire TV experience, which helps our streaming partners reach millions of customers and helps our customers enjoy a great streaming experience,” an Amazon spokeswoman said. “Our commercial terms were updated in June, and we work closely with our partners on the timeline for their implementation.”

It had been in place in the United States since 2018, and “was updated to ensure our business practices are consistent worldwide”, she added.

Under Fire TV’s new terms of service, the owners of apps used for more than 30,000 hours each month “must … provide Amazon with 30 per cent of all revenue received for any advertising in the Fire TV Ad-Enabled App”.

Senior network sources said they were considering pulling their apps – the likes of 9Now, 7plus and 10 Play – out of Amazon Fire TV’s platform.