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Amazon reportedly planning to unite its video offerings in single ad ecosystem

Tim Maytom

While it might not be thought of as one of the major players when it comes to video advertising, Amazon's diverse range of properties actually give it considerable scale, and now the retailer is reportedly planning to bring together its various video platforms and enable marketers to buy ads across its entire ecosystem.

According to Ad Age, which cites industry insiders familiar with the strategy, the move will bring together platforms including the live-streaming service Twitch, which Amazon acquired in 2014, movie information website IMDB and Amazon's Fire TV.

Video ads would be bought through the Amazon Advertising Platform and distributed to its owned-and-operated properties. Currently, the Amazon Ad Platform is largely considered a traditional exchange, providing access to sites outside Amazon, and Twitch, which reaches monthly audiences of around 100m thanks to its videogame live-streaming, sells its own ads, with Amazon only accessing lower quality inventory that is left over.

The new approach will focus on properties where Amazon has the most access to information on consumers, providing it with superior targeting and measurement. It will also significantly boost Amazon's scale, and while it will lag behind Facebook and Google's YouTube, both Twitch and Amazon are still growing and could reach even larger audiences as a united proposition.

According to eMarketer predictions, Amazon's US ad revenue is expected to increase by nearly 50 per cent this year to $1.7bn (£1.27bn), and it will remain ahead of both Snapchat and Twitter when it comes to market share. A more consolidated platform that plays towards the strengths of programmatic would be even more attractive to advertisers, especially those looking for space outside the duopoly.

While Twitch is likely to remain open to third-party sources for some time yet, it's worth noting that the strategy echoes how Google changed YouTube in 2015, making its inventory exclusively available through DoubleClick Bid Manager and AdWords.

While brands will likely relish a more coherent Amazon ad offering, there are also fears that such consolidation could create another 'walled garden', with Amazon exercising strict control over its data and its inventory. The firm is already preparing for an assault on the ad industry, with a new New York office planned that will create 2,000 jobs, mostly in advertising, and is investing in server-side bidding, the latest development in programmatic technology.