September 29, 2016
Amazon’s soon-to-debut music streaming service will reportedly be priced at about $5 per month, say sources. That price point is less than that charged by competitors Spotify and Apple Music, but Amazon’s end game is to increase sales of its voice-controlled Echo. With a focus on its digital assistant, Amazon most recently debuted a less expensive version, the $50 Echo Dot and is promoting the devices, and its virtual helper Alexa, in its physical bookstores and pop-up stores.
Bloomberg notes that, “a central selling point for Echo and rival in-home gadgets is music — the idea that users will be able to use a simple voice command to instantly stream a song of their choice,” which is why, say sources, that Amazon has planned all along to debut a streaming music service.
The Seattle-based company is “willing to lose money on a cheap offering to attract more shoppers to the Echo, with the ultimate goal of embedding all of its services more deeply in users’ everyday lives.”
“This is a seismic change from other streaming services where the interface takes lots of swipes on your smartphone and effort to create the right playlist,” said Berklee College of Music professor of music business management George Howard. “Just being able to say ‘Alexa, play jazz’, for the vast majority of the population, that’s all they need.”
Since Amazon introduced Echo two years ago, it has added more than 1,000 skills, such as controlling lights in the home, checking the weather and ordering a pizza. Bloomberg suggests that, although it can be “overwhelming” to learn all of Echo’s new features, “music is the universal engagement tool, appealing to virtually anyone buying an in-home device,” and that because Echo, through an Amazon Prime account, “includes access to more than a million songs as well as playlists,” it is likely to draw in users, despite any learning curve.
The streaming music service doesn’t require a Prime account, but may also encourage non-members to join up. “They are using music to pull you into that ecosystem, just like Walmart lowered the price on CDs to sell more microwave ovens,” said Howard. “First you’re listening to jazz. Next, you’re dimming the lights and ordering groceries, all on the Echo.”
Users can upload their own digital music libraries to Amazon to access their music via Alexa. The device can also sync with rivals Pandora and Spotify.