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Editorials, The Grid

Streaming Wars: Amazon has surpassed Netflix in America

Historically, When two “elephants” fight, Africans have always been the ants that suffer. But Africans are no ants in the fight between these two elephants – they are spectators.

  • Sanni Oluwaseun
  • 1st January 2023

Amazon is now the biggest streaming platform in the US, at least by the number of subscribers. This is according to the latest ranking by Parks Associates, an international market research and consulting company. A lot to unpack from this development – are we witnessing the beginning of the end of Netflix’s domination in OTT (Over the top) streaming service? Who takes the praise or blame for this – praise Amazon Prime for racing past Netflix or blame Netflix for slowing down? Is this just a US thing or would it be replicated worldwide?

 

A quick trip down memory lane to how it all started. Netflix was founded in 1997 by two American entrepreneurs, Reed Hastings and Marc Randolph. It was supposed to be a DVD-by-mail service that allowed customers to rent movies and television shows on DVD and have them delivered to their homes. In 2007, Netflix introduced a streaming service that allowed customers to watch television shows and movies online. This service became very popular and helped to establish Netflix as a major player in the entertainment industry to date. It’s probably too early to say that status is under threat now.

 


Amazon Prime started more as a value-added service. Its origin can be traced back to 2005 when Amazon introduced the service as a way to offer its customers additional benefits beyond just shopping on the site. At the time, the main perk of Amazon Prime was free two-day shipping on eligible items, which was a significant advantage over the standard shipping options available at the time. Over the years, Amazon has expanded the offerings of Amazon Prime to include a wide range of additional perks and benefits. In 2011, the company added streaming video and music to the service, making it a major competitor with streaming services like Netflix. Okay, history is over, back to business.

 

 

Both Netflix and Amazon Prime had a hand in helping Amazon Prime achieve this new feat in the US. Netflix contributed their quota with a slow start to the year. By April, the streaming giant announced that it had lost 200,000 subscribers with a projection to lose an additional 2 million in the same quarter. The news plunged Netflix shares by about 30%. By June, the company had sacked over 450 of its staff in the space of three months.

 

While Netflix had their hands full with all of those economic and financial issues, Amazon Prime had the following going for them:

 

Strong brand recognition

Even if you’ve never bought a thing from Amazon before, you’ve heard that name before. Amazon is one of the most well-known and trusted brands in the world, and this has likely helped to drive the adoption of its Prime service.

 

Diversified offerings

In addition to its core benefits, Amazon Prime also offers a wide range of other services, such as a grocery delivery service (Prime Pantry), a music streaming service (Prime Music), and a cloud storage service (Amazon Drive). This diversified offering has made it more attractive to consumers who are looking for a comprehensive package of services.

 

Convenience

Amazon has a strong online presence and a user-friendly shopping experience, which has made it easy for consumers to sign up for and use the Prime service. It’s difficult to accurately compare the current number of subscribers for Amazon Prime and Netflix worldwide, as both companies do not publicly disclose their subscriber numbers. However, it is generally believed that Netflix has a larger number of subscribers worldwide compared to Amazon Prime.

 

A 2020 report by Forbes shows that Netflix had about 200 million subscribers globally. Although Amazon has a larger user base, not all of its users are necessarily subscribers to its streaming service. Amazon Prime is a subscription service that includes a variety of perks, such as free two-day shipping on eligible items, discounts on select items, and access to Prime Reading, in addition to access to its streaming service. As such, it is difficult to determine the exact number of subscribers to the streaming component of Amazon Prime.

 

We cannot predict with certainty how Netflix and Amazon Prime will compare in the future. Both companies have continued to grow and evolve over the years, and their relative success will depend on a variety of factors.

 

That being said, Amazon Prime may continue to grow and potentially surpass Netflix in the number of subscribers worldwide. Amazon Prime has some advantages that could contribute to its growth, including its diversified offering of services, strong brand recognition, and convenient shopping experience. In addition, Amazon has a large and well-established e-commerce business, which could help drive the adoption of its Prime service.

 

Bringing it back home to Africa, Netflix is still the apparent market leader here. Though Amazon Prime has been in Africa since 2016, it was just a few months ago that it launched a localized version in Nigeria, making it possible for subscribers to finally pay for the service in naira. Also, Prime Video launching in the most populous African country was a way of telling Netflix to watch their back as far as the African market is concerned.

 

Historically, When two “elephants” fight, Africans have always been the ants that suffer. But Africans are no ants in the fight between these two elephants – they are spectators. Netflix and Amazon Prime would continue to innovate around their prices and content to win this African market that continues to witness wide internet penetration. Offering quality video streaming services to Africans at competitive prices. And on the other spectrum, African filmmakers would get better deals for their creations as the two streaming platforms compete for their content. A 360-degree win for Africa, irrespective of who eventually wins the market.

 

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