Amazon in court: Prime Video advertising ruled unlawful

Amazon Prime Video introduced advertising at the start of 2024, ending its previously ad-free model. Since February 5, 2024, ads have been included in the standard subscription, with an additional €2.99 ($2.99 in the US) per month required to watch without interruptions. Amazon notified customers of the change by email on January 3, 2024, stating that “no further action is required.”

Many users were outraged by the introduction of ads in a streaming service they were already paying for. In response, the Federation of German Consumer Organizations filed a complaint. The Munich Regional Court has now ruled Amazon’s approach unlawful. According to the judges, the company altered existing contracts without obtaining the required consent from customers. The court considered the addition of advertisements a “significant deterioration” of the original Prime subscription.

A key factor in the court’s assessment was that the absence of advertising had been a core feature of the service – even if it was not explicitly marketed as such. While Amazon’s general terms and conditions allowed for changes to the content of the offering, they did not permit a fundamental overhaul of the service structure. According to the court, the shift from an ad-free to an ad-supported model clearly constituted such a major change.

The court also strongly criticized how Amazon communicated the change to its customers. An email sent on January 3, 2024, was deemed a misleading commercial practice. According to the judges, it gave the impression that the change would take effect automatically and have no impact on users, even though it involved a contract modification requiring customer consent. As a result, Amazon was found to have violated Germany’s Unfair Competition Act (UWG).

What happens next

It appears unlikely that Amazon will remove ads from Prime Video. However, under the court’s ruling, the company must refrain from using misleading messages in the future and issue a corrective notice to affected customers. The proceedings did not result in an immediate obligation to refund users.

Amazon responded cautiously to the ruling. A company spokesperson said, “While we respect the court’s decision, we disagree with its conclusions.” According to Amazon, customers had been “informed transparently, in advance and in accordance with applicable law about the update on advertising on Prime Video.” The company is considering further legal steps and has not ruled out filing an appeal. The ruling is not yet legally binding.