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Amazon Aiming Its Guns Directly at Spotify and Apple Music

29 January 2016

From Digital Music News:

According to reports Amazon is planning to launch a subscription-based music streaming service to compete directly with Spotify and Apple Music.

Plans are said to be in the early stages, although there is talk that the service is to launch as soon as this fall.

While Amazon Prime users can already listen to roughly one million songs for $99-a-year, reports state the newly-proposed streaming platform would charge a separate monthly fee.  Sources are saying that there have been several meetings in the past few weeks to discuss licensing tunes for the new subscription music service.  The new service is said to cost $9.99 per month, but will contain a more diverse music selection than what is currently available via Prime.

This is another attempt from Amazon’s Chief Executive, Jeff Bezos, to become the premier distributor of entertainment content. Just the other day, Amazon launched it’s Pandora-like radio service which already boasts hundreds of prime stations across all genres.

. . . .

Amazon currently claims to be the biggest seller of physical music in the US, and the second-best seller of digital music.

Link to the rest at Digital Music News and thanks to Alice for the tip.

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22 Comments to “Amazon Aiming Its Guns Directly at Spotify and Apple Music”

  1. This and bits like it remind me of that song ‘Devil went down to Georgia’ where the kid tells the devil ‘you just sit in that chair right there and I’ll show you how it’s done’.

    I myself don’t need/want the service, but then again I wasn’t using the others either …

  2. I just don’t see them getting much traction in that market.

    • Depends on how you define traction.
      It’s not all Apple, Spotify, and Pandora. There’s other players out there doing well enough; Microsoft, Rhapsody/Napster, and a whole lot of regional players worldwide.

      Amazon probably has enough installed base of streamers that they could use the Freetime Unlimited model to tap a good chunk of their Prime subscribers. Look at their tablet business:it’s peanuts compared to Apple’s. But they still make money off it.

      An Amazon music service tied to the Echo and the upcoming Echo portable might only snag a million subscribers at, say, $8 a month. That’s still $100M a year.

      And as the politician said, “a hundred million here, a hundred million there and pretty soon you’re talking real money.”

      • when was it Bertalsmann, or BMI bought Napster, it seemed to disappear Felix, but no?

        • The original Napster was sued into bankruptcy and Roxio bought the name to rebrand PRESSPLAY. That Napster was bought by Best Buy and later merged into Rhapsody, which is still rolling.

          https://en.m.wikipedia.org/wiki/Napster#Current_status

          • Thanks Felix for the link. I also see that Bertelsmann was to buy Napster, but that it was blocked by a judge: “On May 17, 2002, Napster announced that its assets would be acquired by German media firm Bertelsmann for $85 million. Pursuant to terms of that agreement, on June 3 Napster filed for Chapter 11 protection under United States bankruptcy laws. On September 3, 2002, an American bankruptcy judge blocked the sale to Bertelsmann and forced Napster to liquidate its assets according to Chapter 7 of
            the U.S. bankruptcy laws.”

            Roxio bought it at a ‘bankruptcy sale’… and as your link shows, it went on from there.

    • I agree with Felix. If the service is integrated with Echo, they’ll pick up a lot of users just for the convenience.

      • P.G.

        You have Echo?

        I’m debating, but the wallet is shivering in fear.

        I just need to rob another bank 🙂

        brendan

        • Wait a few weeks.
          There is a baby echo coming.
          No details, just rumor: portable with a charger base, size of a soda can, no always-on mic–it’ll work like on the FireTV voice remotes: hold a button and speak.

          The key question is how portable will Alexa be? Will it have a cellular version like Kindles? Or will it pair with a cellphone?

          Best guess is it will be introduced on Amazon’s first ever super bowl ad.

          • I doubt that it will have built in cell service, for streaming data that adds up to a lot of data fast.

            I would guess wifi, designed to be moved around your house, not roaming around the city.

            • I was thinking of cellular for Alexa, not music. The music could be locally cached.

              • what is Alexa? I thought that was referring to the the downsized Echo?

                • The default name of Amazon’s assistant, like Apple’s Siri or Microsoft’s Cortana.

                • The biggest (and most impressive) diference between Alexa and Cortsna and the rest is that instead of focusing on information, Alexa is focused on actions and activities. It can cough up information like the other pseudo AIs but what is does best is control systems which is quickly turning it into the premiere home automation front end.

                  So a portable Echo might not necessarily even be overly focused on streaming music but instead be more about letting people remotely control their home lights, security systems, thermostats, etc

                  Right now the Alexa cellphone app enables a lot of that but Echo does it much better. A baby Echo? No telling what it’ll do. It might cone with caneras and Firefly…

  3. P.G.

    I fight monthly fees like the very devil. My cash register eyes always calculates the full annual fee and my red face blanches white. Monthlies will kill you.

    I’ve noted since cutting the cable that all manner of people are hiding away from Netflix/Amazon which both lost a ton of content after splitting with Epix catalog in Dec 2015? Late last year, anyway.

    There’s a lot TV channel subs up on Amazon, having taken ’emselves offa prime.

    Nah…I’m resisting ’em. Even though I finally talked Hulu plus into a no advertising mode 🙂

    brendan

    brendan

  4. so instead of $99/year (which works out to $8.25/month) for Prime with music + other benefits, people think that a new service is needed to compete with Spotify (music only for $9.99/month or $119.88/year) and Pandora ($4.99/month or $54.89/year)

    It seems like prime is a no-brainer if you want the music and do ANY other purchasing on Amazon.

    The only question is if the service you go with has music that you like. For me Prime has enough that I’m not looking elsewhere.

    • The rumor is it’ll have a broader catalog and have other features. For example some music services let you download songs to media players, phones, PCs, etc and you get a monthly quota of songs you get to keep even if you cancel.

      The goal would be to get you pay extra on top of Prime.
      FREETIME UNLIMITED is $5 a month, I think, but Prime subscribers only pay $3 a month. So their “Amazon Music Unlimited” might be $10 a month but only $5 for Prime members.

      It makes some sense.

      Similarly, it would make some sense to introduce a higher-grade Prime Video service to upsell to heavy video users, perhaps with live TV channels (like Dish’s SLING TV) for cord cutters. The music service probably won’t work for me but I might be interested in a video package if the price and channels suit my habits.

      • With the current service, you can download an unlimited number of things to your device, and since they can be played by other players (as I discovered accidently), you get to keep them now[1].

        [1] well, worst case, you need to archive them before you delete the amazon music app to prevent it from ‘cleaning up’ after itself, and then restore them to the device after the app is gone.

        As you say, the key is in the selection. Given the age of most of the music I listen to, it’s not a big problem. But if current artists are not letting Amazon include their stuff without more payment, then the people who want those artists works can pay more for a service that includes them. I think it will be very interesting to see what happens if this becomes an option. How many people will pay more for the most current stuff?

  5. Since google wrapped Google Music and Youtube Red together the choice of streaming service has been rather easy for me. I get music, can support the youtube creators I like and don’t have to watch stupid ads on Youtube? Rock on!

    Amazon Prime Music Streaming (or whatever they call it) isn’t compelling for me. I already keep my Netflix and Hulu subscriptions even tho I am a Prime member. It will probably be a nice add-on (like most Amazon Prime services) but not a market leader.

  6. They will have to make VAST improvements to their music library. I tried it for awhile and the song selection was so small that stuff repeated far too often.

  7. An added thought:

    The digital reader blog has been tracking Audible’s sizeable investment in original content which is still ramping up:

    http://the-digital-reader.com/2016/01/30/bloomberg-audible-is-still-hiring-new-engineers-pushing-further-into-original-production/#comment-1081099

    Maybe the new streaming audio service won’t be targeting Spotify alone (or at all) and instead will target the satellite radio market?

    Instead of tying their original audio content to Audible or KU, maybe they’ll use it as a differentiator for the new streaming audio subscriptions?

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