Amazon investigating possible Echo-Only Music Service and undercutting industry pricing
In a move that undercuts the entire streaming music industry, online retail giant Amazon is reportedly developing $4 or $5 per month subscription service that could see release next month. The catch: the service only works with Amazon Echo hardware.
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Citing industry sources, Recode reports Amazon is currently in talks with music labels to introduce the cheap, unlimited streaming service exclusively on its Echo line of internet-connected speakers. Affordable monthly fees is the main draw, though Amazon has yet to decide whether to set pricing at $4 or $5 a month.
The supposed Echo-only service would be marketed alongside a traditional $10-per-month product also said to be in development. Unlike the cut-rate version, Amazon’s full-featured standalone streaming product is expected to work on a variety of devices, including smartphones.
In the early days of music streaming, companies experimented with offerings priced at around $5, but those services usually came with stringent limitations on song skipping or number of registered devices. Consumer response was tepid, as users seemed willing to spend the extra money for full control over their listening experience. Industry competitors, led by Spotify and Pandora, ultimately settled on a $9.99 per month sweet spot, a price point more recently adopted by Apple Music.
As noted by today’s report, portability is one of the main draws of any streaming service. For many subscribers, the ability to keep an essentially unlimited music library in your pocket is worth the price of entry. Amazon’s plan, at least for the cheaper $4 or $5 a month version, is to add value to a family of devices used mainly at home (although the Amazon Tap is a portable bluetooth speaker). Echo already supports a number of streaming apps including Pandora, Spotify and Amazon Music, the latter of which provides Amazon Prime members free access to a comparatively small music library.
Amazon is reportedly targeting a September launch window for both standalone streaming services.
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