AMC Premiere, an ad-free version of the popular cable network AMC, will be available for $4.99 per month to Comcast’s Xfinity TV subscribers, the latest initiative by pay-TV incumbents to offer more flexible access to viewers. AMC Premiere provides ad-free access to the network’s current season programs along with a variety of exclusive and first-look content and movies.
However, AMC Premiere does not include past seasons of “The Walking Dead” for example, or any of the iconic programming like “Mad Men” or “Breaking Bad,” which put AMC on the map for high-quality originals. All of those have long been licensed to Netflix. The most recent season of “The Walking Dead,” as well as prior ones, are available on demand from Comcast for $2.99 per episode. Many other shows from other networks are available at no charge on demand from Comcast.
AMC Premiere is an interesting experiment to gauge how deep viewers’ interest is to avoid ads. Other similar experiments have not revealed a strong appetite to pay extra to avoid ads, the most notable being Hulu’s no ads version, which costs $4 per month more than its version with ads. Hulu has said that the vast majority of its subscribers still choose the fully ad-loaded, cheaper option. YouTube Red, an ad-free version YouTube, which costs $10 per month, has had limited success. Conversely, Netflix and Amazon are both ad-free and are hugely popular. CBS All Access has also recently launched an ad-free option.
The other factor in play here is the use of DVRs and how they enable ad-skipping. Approximately 50% of pay-TV homes now have a DVR, and if they’re used by AMC fans to record a season pass of their favorite shows, they can easily also be used to time-shift and binge-view, plus skip all the ads. This has become a popular way of viewing cable and broadcast content in our family, for example.
So, on the one hand, it feels like the opportunity for AMC Premiere is relatively shallow. But on the other hand, it still feels like a very worthwhile initiative for both companies to learn more about viewers’ interests and willingness to pay. For Comcast in particular, it’s a move toward providing more SVOD choices along the lines of what Amazon has been doing really well with its Channels program.
Finally, to the extent AMC Premiere succeeds, it puts even more pressure on improving viewers’ experiences with ads, which remain a core industry revenue stream.