Amazon has launched a new service allowing users to post videos and earn royalties from them, in effect competing against Google’s YouTube.
Amazon Video Direct makes uploaded videos available to rent or own or viewed free with ads. Videos could also be packaged together and offered as an add-on subscription.
The licence agreement will have content creators getting 50 per cent of the revenue earned from rental receipts or sale of the videos.
YouTube by way of contrast offers a free, ad-supported service. It also has a US$10-per-month subscription option called YouTube Red.
It’s no surprise that Amazon is moving into this area.
Its Prime loyalty program already offers original TV programming and access to digital entertainment products such as Prime Music and Prime Video.
It also offers one-hour delivery of purchases, for an annual fee of US$99.
The service is not yet available in Australia.
Analysts however are not convinced it will be that big a challenge for YouTube.
“I don’t see 50 million Prime users making a huge dent in the 2 billion YouTube user ecosystem,” Wedbush Securities analyst Michael Pachter told Reuters.