Amazon Video Direct Lowers Prime Streaming Royalty

I’ve pretty much told everyone who will listen that if you’re a filmmaker doing short films, AVD, not Youtube, is the place to be. Especially since the new YPP policy at Youtube is about to take effect. I have made way, way more off a few short films on Amazon Video than I ever did off of Youtube.

Apparently Amazon woke up to how sweet the deal was, and has just announced that they are drastically reducing the royalty rate for videos watched through Amazon Prime streaming.

Previously videos watched with Prime got $0.15 per hour of video watched (In the US). Titles submitted through AVD had a maximum cap royalty of $75,000 per year per title.

Some people were upset about that cap. But to reach it your video had to be streamed for 500,000 hours. If you’ve got content that popular, it might be time to work with a distributor that can bypass the Amazon Video Direct system and go directly with Amazon.

The new royalty rates eliminate that cap. Which is good, I guess. And the new rates are for all territories. Not just the US. The new rate is what AVD paid for other territories outside the US. And while the rate drops a lot, you can earn higher rates if your videos are watched a lot.

The new rates are tiered based on hours of viewing PER TITLE. Up to 99,999 hours you get $0.06 per hour. That’s right, the rate drops by almost 2/3 in the US. This will put me right about the Youtube payment range. Most short films will never hit this amount of viewing time.

If you have 100,000 hours of viewing, the rate increases to $0.10 per hour. Over 500,000 hours and you’re back to $0.15 per hour. But cross 1,000,000 hours and you drop back to $0.06 again.

In order to reach the $0.15 per hour rate again, you have to have 500,000 hours of viewing. So the cap is gone, but it takes longer to hit $75,000.

($75,000 in royalties? Who are we kidding? How many indie filmmakers hit 500,000 hours of viewing on Amazon?)

A 5 minute long short film would need to be watched in its entirety 1,200,000 times in a year before that title could make $0.10 per viewing hour, which is still 1/3 less than the original royally. A 2 hour movie would need to be watched 50,000 times to hit that same royalty rate.

So, why? Why is Amazon doing this? Here’s what they say:

“The tiered structure allows us to align the Prime Subscription Access rate with the level of customer engagement generated by each individual title or season (more engaging titles earn a higher royalty rate). By doing so, we offer a few advantages for providers, including elimination of the title-level annual earnings cap and expanded earnings potential in territories outside the U.S.”

I get it. I’ve seen some bad videos on Amazon Prime. And even though I have short films on Amazon, I know most people don’t sit down at the TV and look for short films. So Amazon is making it less lucrative for creators who pump out bad or short content, and focusing on content that keeps viewers engaged for longer; because it’s good enough that people watch more of it and because it’s literally longer.

But, man it stinks for short film creators. Up to this point AVD was a good way to make a little extra cash for your efforts. Not major money, but better than the alternatives. Now that Youtube has put the clamp on casual creators, AVD is still the best outlet for short content. But the paycheck is about to get a lot smaller than it already was.

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