Amazon.com Launches Prime Music, as an Ad-Free Streaming Service

Amazon is now trying to make their mark in the streaming business by launching its own add free service, called Prime Music.  This service is available free to Amazon Prime subscribers (they pay a $99/year membership).  The company is taking a different approach to streaming business compared to their competitors.

Amazon promises members will have access to over a million songs (from artists including Beyonce, Madonna, Bruce Springsteen, John Mayer, Blake Shelton, and Britney Spears), while competitors, like Spotify, offer 20 million songs.

It is also reported by the NY Times that most new releases will be omitted, and will include the music of two out of the three major labels.  Sony and Warner Music have signed deals, but the catalog of the Universal Music Group (whose catalog includes stars like Kanye West, Katy Perry, and Lady Gaga) will NOT be included, as the group did not reach an agreement with Amazon.

Additionally, Amazon’s proposed contracts for songwriting rights were rejected by many music publishers, and as a result, Amazon may have more limited use of songs than they originally intended.

So how can Amazon compete with the likes of Spotify, Beats and Rhapody who offer way more songs?

Well, they can compete because of their enormous size (244 million active customer accounts and an estimated 20 million Prime subscribers).

Despite limitations in their catalog, Amazon plans to help their cause by releasing Prime Music apps (with support from  PC, Mac, Android, Kindle Fire, and IOS) with unlimited offline playback.  This may help Amazon out in the future, but they are not available for download yet.

Amazon has size to it’s advantage, but will they be able to convince casual music consumers to sign up for their streaming service or switch from their competitors who offer a much larger catalog?