Amazon, the eCommerce giant, could launch a music service that is free and ad-supported in the coming days, reported Billboard.
According to Billboard, citing sources familiar with the plan, Amazon is mulling marketing the service through its Echo speakers and Alexa, its voice-activated digital assistant. The service would start with a limited catalog of music and could launch next week, reported Billboard.
According to the report, Amazon has been in talks with record labels to obtain licenses for the free music, offering to pay some record labels per stream in the beginning irrespective of how many ads Amazon sells on the service. The move comes as Amazon looks to take on Spotify in the music streaming market and underscores just how formidable a competitor it can be. Unlike Spotify, Amazon’s size and capital enables it to lose money on the music service if it drives more business to its eCommerce sites. Spotify can’t do the same and is under pressure by investors to become profitable.
Amazon has a service in Prime Music that is available for members who pay $119 a year for free delivery, free movies, discounts and access to streaming music. For $9.99 a month, customers can also subscribe to Amazon Music Unlimted. Billboard reported Amazon is dropping the fee for the music streaming service to $7.99 a month for Prime members and $3.99 a month for those who only access music via an Echo device. The report noted that as it stands, Spotify is the only other big streaming company that has a free package. That package lets users listen to albums or artists on demand, but the user can’t control which songs it hears and in which order. Billboard noted that while Amazon hasn’t said how many customers pay for the music streaming service, reports in 2018 pegged it at more than 20 million subscribers.