User generated videos must be a really big business because another huge online player just jumped into the arena with YouTube and Facebook. Yesterday Amazon announced the launch of its new video posting service, called Amazon Video Direct, in the United States, United Kingdom, Germany, Austria and Japan.
The launch partners include Conde Nast Entertainment, HowStuffWorks, Samuel Goldwyn Films, The Guardian, Mashable, Mattel, StyleHaul, Kin Community, Jash, Business Insider, Machinima, TYT Network, Baby Einstein, CJ Entertainment America, Xive TV, Synergetic Distribution, Kino Nation, Journeyman Pictures, and Pro Guitar Lessons, but curiously, no record labels.
Amazon has also announced how it will pay everyone, as well as how they will take down videos if copyright infringement occurs.
Amazon Video Direct (AVD) gives partners four options when uploading their content:
- Include the work in Prime Video, which is available to tens of millions of users of the premium subscription tier
- Make it available as an add-on subscription through its Streaming Partners Program
- Offer it as a one-time rental or a one-time purchase
- Make it available to all Amazon customers, which is ad-supported like YouTube
According to Variety, the Prime Video option pays video owners a 15 cents per-hour royalty fee in the US and 6 cents per-hour in other territories, but that appears to cap at $75,000 per year. On top of that, Amazon will also pay partners a 50% royalty of the retail price from one-off purchases and rentals. As with YouTube, Amazon will pay the partner 55% from any ad revenue received.
Amazon will also distribute $1 million a month to the makers of the 100 most popular programs viewed by Prime members each month.
Amazon Video Direct could be a game changer for content creators in that it’s now possible to get paid a reasonable amount for your content. That said, even though Amazon Prime has tens of million of subscribers (the exact number is unknown but may reach as high as 90 million), it’s still hard to compete with free, which is what YouTube still provides.