The company will reportedly be making a catalogue of music six months and older available free to all of its Prime members.
Although it won’t have as much music as larger, more focused streaming competitors like Spotify or Pandora, Amazon’s service will be just another way for the company to try to entice people to sign up for its $US99 Prime service. Prime members tend to spend almost double what non-members do on Amazon, so it’s in the company’s favour to make the two-day free shipping service as attractive as possible.
Music streaming is becoming increasingly competitive. Apple just bought Beats for $US3.2 billion in part because of its subscription music streaming service. iTunes downloads have suffered as people have turned to apps like Pandora to stream music for free. Pandora is on track to have $US1 billion in revenues annual. Spotify has perhaps $US1.2 billion in revenues.
Amazon has also recently been beefing up its video streaming content. Selling digital content — be it movies, television shows, books, or music — instead of its physical counterparts, lets the company save money in storage and shipping.
Amazon has apparently reached agreements with two of the three major labels: Sony Music Entertainment and Warner Music Group.
BuzzFeed reports that the music service will work across multiple devices, let users play songs as many times as they want, and have some offline capabilities.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.
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