A class-action lawsuit accusing Amazon Prime of deceptive business practices and deceptive advertising was prompted by outrage over the company’s choice to put commercials in its video programming without costing extra.
Ad Intrusion Sparks Consumer Backlash
Prime member Wilbert Napoleon brought the lawsuit, claiming that although users had initially purchased their memberships with the expectation of an ad-free streaming experience, they were surprised by the recent policy change. The lawsuit alleges violations of consumer protection laws in Washington State and California and seeks an injunction against Amazon for allegedly engaging in misleading practices. It also seeks specific damages, including punitive penalties.
The lawsuit is a reflection of the discontent of at least one Prime member as well as maybe additional customers who feel duped by Amazon’s latest policy shift. Amazon is accused in the case of breaking consumer protection laws in California and Washington State, with a focus on unfair competition and dishonest business practices.
Amazon’s Alleged Unethical Conduct
Amazon’s actions have been described by the plaintiff as “immoral, unethical, oppressive, unscrupulous, and substantially injurious to consumers.” The lawsuit attempts to make Amazon answerable for what it considers to be a betrayal of Prime members’ confidence.
On January 29, Amazon made the adjustment, putting advertisements in Prime Video programming by default in several major areas, including the US. According to analysts, Prime Video advertisements will bring in more than $3 billion by 2024. Notably, ad-supported plans have recently been announced by both Disney+ and Netflix.
These services, however, provided different, less expensive levels for ad-supported programming, in contrast to Amazon Prime Video. The uproar surrounding Amazon’s choice brings to light the difficulties platforms encounter when changing the terms of service and adding advertisements.
Amazon’s Response and Impact on Revenue
At the fourth-quarter 2023 earnings call, Amazon CEO Andy Jassy defended the decision in spite of the criticism, saying that the business would be able to keep investing in content because Prime Video now features adverts by default. Jassy reaffirmed Amazon’s commitment to investing in exclusive content for Prime members and voiced confidence in Prime Video’s ability to be a profitable stand-alone business. The court cases could provide insight into how to strike a balance in the ever-changing streaming service market between generating revenue and upholding client confidence.
