When Mike Hopkins was approached about leading Amazon Prime Video, he initially saw it as merely a perk for subscribers of the online retailer’s two-day delivery service. This view was widely shared in Hollywood. However, Amazon founder Jeff Bezos had far grander ambitions for the service, envisioning it as a cornerstone of a burgeoning media empire.
“After meeting with Jeff, it was clear he saw an opportunity to build a media company,” said Hopkins, an industry veteran with experience at Fox Networks, Sony Pictures, and Hulu. Over the past four years, Hopkins has steered Prime Video towards becoming a major Hollywood player.
Under Hopkins, Prime Video has been transformed into a traditional media company with its own film studio and theatrical distribution arm. The service boasts a growing lineup of original movies and series featuring A-list actors, an expanding roster of professional sports, and a robust advertising strategy. “We … like the progress of Prime Video,” Amazon CEO Andy Jassy told investors this month.
Prime Video’s star-studded content and live sports offerings position it to capture a larger share of the $28.75 billion expected to be spent on digital advertising in streaming this year, as traditional television sees declining investment. Morgan Stanley estimates Prime Video ads could generate $3.3 billion in sales this year, potentially doubling to $7.1 billion within two years.
Despite these strides, Prime Video still trails behind industry leaders YouTube and Netflix in U.S. streaming viewership, according to Nielsen. However, more of its shows have entered Nielsen’s Top 10 ranking of the most-streamed original series in 2023, indicating its growing influence.
Amazon’s aspirations for Prime Video as a comprehensive entertainment destination are becoming clearer, according to agents, ad buyers, and entertainment executives. Prime Video became the first streaming service to secure an exclusive deal with the NBA, adding to its year-round sports programming, which will soon include NFL football, NASCAR, the WNBA Finals, and Champions League soccer.
Amazon also plans to significantly increase its number of theatrical releases, aiming for up to 16 by 2027. This expansion, coupled with its strategy of acquiring and directly distributing a dozen or so movies each year, positions it to rival major studios like Universal Pictures.
Prime Video has increased its investment in content production by $1.7 billion to $13.6 billion this year, while other studios cut back. Its talent roster now includes Hollywood A-listers such as Reese Witherspoon, Jake Gyllenhaal, and Octavia Spencer, alongside sports stars like Roger Federer. The platform even brought on Netflix’s former film chief, Scott Stuber, to revive the United Artists label at Amazon MGM Studios.
Prime Video now recognizes the importance of premium content and celebrity appeal to attract advertisers. “Before, they had the reach and scale, but they didn’t have the content story,” said Jessica Brown, managing director of digital investment for GroupM. “You need to be culturally relevant.”
The advertising industry took notice when Prime Video began showing ads to its roughly 115 million U.S. viewers, making it the largest ad-supported subscription streaming service domestically. Advertising executives highlight the unique opportunity Amazon offers, with the ability to sell products seen during commercial breaks instantly.
Amazon’s creative efforts have seen both successes and challenges. Hits like “The Boys” have resonated globally, while expensive projects like “Citadel” have struggled. Hopkins and his team aim to create broadly appealing content with a global reach, akin to popular and commercially viable “airport novels.”
Amazon’s strategic focus includes catering to four audience segments, ensuring a steady stream of content tailored to different demographics. Projects with broad appeal receive larger budgets, while niche content is budgeted accordingly. Agents report that Amazon is seeking young adult fare, action-thriller series, and female-focused stories, reflecting its diverse content strategy.
Despite its evolving content strategy, Amazon remains committed to significant investments in sports programming. The company also plans to create an extensive entertainment hub, featuring free ad-supported channels, rival streaming services, and recent movie releases, all accessible via Prime Video’s redesigned app.
“We’re not just building a single subscription service,” said Hopkins. “We’re proving that we can play a much broader game.” As CEO Jassy stated, “We’re on track to be a meaningfully profitable business in our own right.”