Paid for Prime, got ads instead? Amazon is now being sued

Amazon is embroiled in legal proceedings in Australia due to its recent decision to incorporate advertisements into Prime Video for customers who have already subscribed for a year. The Australian Competition and Consumer Commission (ACCC) asserts that this move unjustly downgraded the service and imposed additional fees on users wishing to avoid ads. The ACCC has initiated a lawsuit in the Federal Court against Amazon Australia, arguing that the subscription terms allowed the company to implement significant changes to the streaming service without providing compensation to its subscribers. The regulator estimates that over one million annual Prime members were impacted between November 1, 2023, and August 18, 2025. At the heart of the case is Amazon's rollout of advertisements on Prime Video set for 2024. According to the ACCC, subscribers who had already paid for an annual membership were transitioned to an ad-supported version of the service. To continue enjoying ad-free viewing, these users would have to pay an additional fee of A$2.99 per month starting July 2024, despite the upfront payment of A$79. The ACCC highlighted that more than 850,000 customers had prepaid for their annual subscriptions before the introduction of ads, effectively receiving a diminished service unless they opted to pay the extra fee. The regulator also pointed to five unfair contract terms that permitted Amazon to modify Prime services, including Prime Video, without offering refunds or adequate compensation. Moreover, the ACCC claims that Amazon.com Services LLC was involved in drafting the Australian subscription contracts and was aware of the conduct in question. This investigation was prompted by consumer complaints regarding the sudden appearance of advertisements. In response, an Amazon Australia representative stated that the company is thoroughly reviewing the ACCC's case and has been cooperative during the investigation. Notably, Prime Video had maintained an ad-free experience for over a decade as part of Amazon's comprehensive Prime membership, which was introduced in Australia in 2018. The company began to implement advertisements on Prime Video in various global markets in early 2024.