Amazon cutting hundreds of jobs across Prime Video, MGM Studios and Twitch

Alan Ritchson plays Jack Reacher in Amazon Prime Video's hit show Reacher, based on Lee Child's novels.

Amazon is cutting several hundred positions across its Prime Video and MGM Studios unit.

Last month Amazon said that Prime Video users would start seeing ads on movies and television shows starting on January 29, setting a date for an announcement it made in September.

Prime members who want to keep their movies and TV shows ad-free will have to pay an additional US$2.99 per month (Prime Video costs $8 per month in NZ, where no ad plans have been announced).

Mike Hopkins, senior vice president of Prime Video and Amazon MGM Studios, said in a note to employees that the company is boosting investment in areas with the most impact, while stepping back from others.

Amazon has cut thousands of jobs after a hiring surge during the pandemic. In March, Amazon announced that it planned to lay off 9000 employees. That was on top of the 18,000 employees the tech giant said that it would lay off in January 2023.

Job cuts are occurring elsewhere in the company this week.

Twitch, the video game streaming platform acquired by Amazon a decade ago for close to US$1 billion ($1.6b), is laying off more than 500 employees as the company tries to turn the tremendously expensive division profitable.

Twitch CEO Dan Clancy in an email to employees said that even with cost cuts and growing efficiency, the platform “is still meaningfully larger than it needs to be given the size of our business.

“For some time now the organization has been sized based upon where we optimistically expect our business to be in 3 or more years, not where we’re at today,” Clancy wrote.

Departing employees at Amazon Prime will receive a separation payment and other benefits like job placement support.

In May Amazon said that it would distribute its original films and TV shows, like The Marvelous Mrs Maisel, to media outlets outside its Prime Video service for the first time.

That content would be licensed via a new unit called Amazon MGM Studios Distribution, which expands the number of titles currently offered by Hollywood studio MGM. In 2022, the e-commerce-behemoth-turned-media-giant closed its acquisition of MGM — which houses more than 4000 film titles and 17,000 TV episodes — for US$8.5 billion.