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Amazon’s oft-rumored music streaming service will apparently limit how much a subscriber listens to a given song. According to sources speaking to The Wall Street Journal, the online retailer “is hoping” to offer an on-demand service as a perk for Prime subscribers, though limiting playbacks doesn’t sound like much of a perk at all. Amazon and record companies have reportedly been unable to come to any agreements during negotiations. A report last month claimed Amazon was trying to secure a substantial discount over what other competing services pay.
The underlying focus of an Amazon music service will be to boost MP3 sales, sources speaking to The Wall Street Journal claim. The service will presumably work by giving users a limited number of streams, and when their allotment runs out, Amazon will encourage users to buy that particular song or album. Apple’s motive for introducing iTunes Radio was similar, though the Cupertino company already dominates digital music sales. The addition of music streaming to Prime would likely cause the annual cost to go up, which has been rumored to balloon up to $119 from $79.
Negotiations are murky at the moment, The Wall Street Journal said. Amazon allegedly wants to pay record companies a fixed amount each month, rather than basing cost on how often users listen to a particular song. Though, apparently, more than competing services. Meanwhile, record companies want to keep their latest releases off the service. Just today sources close to Apple claimed the Cupertino company was trying to grab timed exclusive content for iTunes in an effort to give digital sales a head start before that content is available for streaming.
Amazon’s music service could be a value ad to Prime subscribers, but is there enough room in the market? According to a recent report from Statista, Pandora owns a 31 percent chunk of the streaming market, while iHeartRadio, iTunes Radio and Spotify all lag far behind, with 9 percent, 8 percent and 6 percent shares of the market, respectively. Will Amazon’s service offer enough incentives for its users to ditch those offerings?
More than anything, Amazon’s rumored service sounds a lot like Apple’s iTunes Radio, though users will supposedly be limited by certain time constraints. The goal will be to encourage users to actually purchase the music they listen to, rather than using a service like Spotify, which gives users unlimited access to 20 million songs for a monthly fee. That may not sound like the most consumer-friendly model, but the potential business of it could bring in may more digital downloads each year.
Source: WSJ
