Amazon in talks to offer a music streaming service

by Mark Tyson on 28 February 2014, 14:40

Tags: Amazon (NASDAQ:AMZN)

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A report yesterday on Re/Code cites "industry sources," saying that Amazon is in talks with record labels to offer a music streaming service similar to Spotify, Rhapsody or Beats. It is thought that this music streaming would be bundled into Amazon Prime Instant Video to make it more attractive following price rises for the service.

Amazon Prime Instant Video has only just kicked off in the UK by matching the US offering of free expedited delivery services and movie/TV show streaming. In the UK the merge of Amazon Prime and LOVEFiLM occurred just two days ago. Many HEXUS readers were not impressed by the upcoming hike in price – what if you wanted just the media streaming or just the delivery enhancements? Also the new regular price was said to be £79 per annum – quite a big chunk in a single payment.

However it's not just Amazon UK's customers who are looking down the barrel of a price hike the WSJ reported recently that Amazon US is considering upping the price of 'Prime' by as much as $40 in the US. This is apparently due to the increase in fuel and shipping costs - we must remember the US is very much larger than the UK (also its 2 day delivery over there).

Of course Amazon doesn't want to lose precious 'Prime' customers who spend nearly twice as much ($1,340 p.a. in the US) as non-Prime subscribers. So perhaps Amazon thinks it can raise the price and offer this new music streaming service 'value' as some kind of sweetener/compensation.

This is just early days though and one of Re/Code's sources says that the deal is far from done with one music label in particular. We hear that Amazon is trying to push for "a substantial discount on the pricing the labels have given to other services". Supporting the music streaming murmurings, Amazon has hired various bigwigs from Sony music and Rhapsody in recent months.

Personally, I often teetered on the edge of joining Prime for deliveries – as I have an Amazon Mastercard and save up lots to spend on there. However I'm not very interested in video streaming and even less interested in music streaming so there better be some pretty good promotions coming up if I'm ever to sign up for the new Amazon Prime Instant Video service.

HEXUS Forums :: 4 Comments

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Posted by KrisWragg - Fri 28 Feb 2014 14:50
Already stopped my Prime membership from renewing, decided to give the instant films a trial at home the other night and was not impressed as it didn't work on my linux media PC connected to our TV, also doesn't work on Android tablets only Amazon Fire tablets.

I did eventually get it to work on the Linux machine by installing something called pipelight which allows Windows plugins like Silverlight and Flash to work properly in Linux chrome. But honestly that is a horrible solution when they could have used HTML5 video or something.
Posted by lyserman - Fri 28 Feb 2014 15:14
Already told Amazon I will not be renewing when the price hike happens as it is something I didn't ask for or need.
I did suggest a two tier system of delivery only and delivery plus streaming and the customer service person said they would pass it up the line for consideration.
I hope they do offer it as I get loads from them and find the Prime system good value.
Posted by crossy - Fri 28 Feb 2014 15:14
Personally, I often teetered on the edge of joining Prime for deliveries – as I have an Amazon Mastercard and save up lots to spend on there. However I'm not very interested in video streaming and even less interested in music streaming so there better be some pretty good promotions coming up if I'm ever to sign up for the new Amazon Prime Instant Video service.
I've got Prime purely for the fast deliveries … £40 for unlimited next-days seemed justifiable, especially for all that Christmas shopping. But a doubling in price so I can “experience” a video streaming service that I have no interest in, and now a music streaming system that's of slightly more interest? No sale Amazon.

I know other people “can't live without” the likes of Spotify etc, but I'm old fashioned enough to use the radio (free and freely available) and far prefer to get my music on disk - whether that be CD, DVD or LP.

I think Amazon would be better served to keep these “value add” services as stuff you can opt into. Even take a leaf from the book of the likes of Sky, Talk-Talk, BT, Virgin, etc and offer a rising discount based on the extra services you take.

Unless there's a far cheaper delivery-only option that appears between now and November (my renewal), then I'll definitely be cancelling my Prime membership. To be honest, if Amazon need to increase the price of Prime to cover increased delivery costs, then they'd be better advised to do that, and not bother with all this kind of slight of hand.
Posted by Saracen - Fri 28 Feb 2014 17:06
As the article said, I'm not much (at all, in my case) interested in video streaming, and even less in music streaming.

Prime, as it was, was borderline for me. The new version, whether with video, music or both adds £0.00p in value to me. So, it amounts to a £30 price hike for a service of very borderline value to me anyway, as I don't buy that often, and even less where I need next-day. Usually, std-free is fine, even if it takes several days.

So music streaming? Not interested at all.