Amazon today officially became the latest entrant into the highly competitive music streaming business with its launch of a full-fledged music streaming service with subscriptions as low as $3.99 per month for owners of its Amazon Echo speaker, accelerating the industry trend toward more flexible pricing after years of sticking to $9.99 subscriptions.
With Amazon Music Unlimited, users can access a vast catalog of songs on demand, similar to Spotify and Apple Music. Subscriptions to play music on the Echo cost $3.99 per month; for access beyond that device, subscriptions cost $7.99 a month for members of Amazon’s Prime shipping and video service and $9.99 for non-members. Amazon added it will continue to offer Prime members a limited streaming service for free.
As it plunges deeper into the crowded streaming field, Reuters reported Amazon is counting on the Echo, a smart speaker that responds to voice commands, to set it apart. Released broadly last year, the Echo has become a surprise hit, prompting many to predict that voice will become a key way users interact with technology – and music is central to the device’s appeal.
Amazon has built an elaborate system of voice controls for listening on the Echo. The company believes such smart home devices will be a key source of growth for the music industry, said Steve Boom, vice president of Amazon Music.
“The first phase of growth (in music streaming) was driven almost entirely by smartphones,” he said in an interview. “We believe pretty strongly that the next phase of growth in streaming is going to come from the home.”
“The low price for Amazon’s streaming service is consistent with the company’s reputation for undercutting the competition and signals the music industry is beginning to accommodate consumers who are unwilling to pay $9.99 per month. Having watched revenues plummet from the CD era, label executives have been reluctant to budge on price, but they have come under pressure as streaming accounts for more of the pie,” Reuters reported.
Boom said he is optimistic that the new prices will expand the market. “We’re moving music away from a one-size-fits-all approach,” Boom said. “We are the ones who have been pushing this the hardest.”
