Amazon Prime's secret advertising plan to beat Netflix and Apple

Rumours are rife that Amazon will soon launch a free streaming service that would replace subscription charges with adverts.

According to adage.com, people familiar with the plan say the company is making inroads with TV networks, movie studios and media companies to launch the service. Amazon would link payments for channels and programmes based on the number of hours people watch. It could also share audience information alongside the ad revenue.

UK residents pay £7.99 a month for Amazon Prime, which promises next day delivery and entitles Prime subscribers to Amazon's video streaming service. "Amazon is talking about giving content creators their own channels and sharing ad revenue in exchange for a set number of hours of content each week," an anonymous source told adage.com.

The online shopping giant has been making headlines recently for its innovative ideas. At the start of November, it rolled out an augmented reality update to its app that lets users virtually place furniture and items around the house before they are purchased. It also announced Amazon Key in October, which lets delivery drivers unlock an homeowner's front door to leave a parcel.

But the press has not been all good. An Amazon Echo recently "went rogue" and started blasting music at 2am while the homeowner was out. Police eventually attended and the subscriber incurred a late night locksmith fee (which Amazon has since offered to cover).

Amazon is yet to confirm the free-streaming with ads concept. IBTimes UK had not received any comments from Amazon UK before publication.