**Australia Sues Amazon Over Alleged Unfair Contracts in Prime Video Service**
The Australian Competition and Consumer Commission (ACCC) has initiated legal proceedings against Amazon, alleging that the company has implemented unfair contract terms regarding its Prime Video streaming service. This lawsuit comes in response to Amazon's decision to introduce advertisements into Prime Video, a service that had previously been marketed as commercial-free.
According to the ACCC, the legal action is based on claims that Amazon violated consumer protection laws by altering the terms of service for over a million subscribers between November 2023 and August 2025. ACCC chair Gina Cass-Gottlieb stated that customers who wished to avoid advertisements were forced to pay an increased fee to maintain the ad-free experience they initially subscribed to.
Historically, Amazon's Prime Video service, which became available in Australia in 2018, was included as part of the broader Amazon Prime subscription. This subscription model has traditionally focused on delivering a seamless, advertisement-free viewing experience. However, in early 2024, Amazon began rolling out advertisements globally, including in Australia, prompting significant changes to its service.
When Amazon introduced ads in Prime Video, it notified Australian subscribers that they would need to pay an additional monthly fee of AUD 12.99 to retain the ad-free experience. At that time, the ACCC reported that more than 850,000 Australians had already paid for an annual Prime subscription. As a result, these subscribers found themselves with a downgraded, ad-supported version of Prime Video for the remainder of their prepaid terms unless they opted to pay for the ad-free option.
The ACCC's filing highlights five specific contract terms that it alleges are unfair. These terms reportedly allowed Amazon to unilaterally make significant changes to its services, including Prime Video, without providing subscribers any entitlement to refunds or other forms of meaningful compensation. This practice, according to the ACCC, undermines consumer rights and protections.
Amazon's business practices have faced scrutiny not only in Australia but also in other jurisdictions. In the United States, the Federal Trade Commission (FTC) has taken legal action against Amazon for allegedly signing up individuals for Prime memberships without their consent and complicating the cancellation process. Recently, Amazon agreed to pay a fine to the FTC to settle claims regarding the difficulties faced by victims of online shopping fraud.
In the UK, Amazon has also been the subject of government investigations concerning its product listing methods and the prevalence of fake reviews on its platform.
As the lawsuit progresses, it remains to be seen how Amazon will respond to the ACCC's claims and what implications this legal action may have for its operations in Australia and beyond. The outcome could potentially influence how digital services are marketed and delivered, particularly concerning consumer rights and protections in the rapidly evolving landscape of online streaming.