Amazon leaks ad-supported music service

Billboard is reporting this morning that Amazon plans to offer and ad-supported streaming music service possibly similar to services offered by Pandora or Spotify.

If true, service would join other Amazon listening services already in the market. Prime Music, offered to Amazon Prime subscribers, offers a small catalog of 2 million songs for free listening. In addition Amazon has a completely on-demand music service with a 50-million song catalog, priced at 10 dollars a month or eight dollars for Prime members. That service puts Amazon into competition with Spotify and Apple music. (A four-dollar version is available for Echo-only listening — that is Amazon’s family of voice-controlled speakers.)

Missing in this array is a listening service supported by advertising that draws on Amazon’s full music catalog. If that becomes a reality Amazon will join Spotify, Pandora, and iHeartRadio as the only mainstream online music services offering ad-supported free listening. Of course, the internet radio category is based on that type of service, and is comprised of thousands of niche stations.

Amazon’s competitive advantage over Spotify and Pandora (and to some extent iHeart) is that music is just one component in an array of consumer offerings. Spotify will thrive or flounder on music delivery separate from any surrounding or underlying business. The same could be said of Pandora before its recent acquisition by Sirius XM — but even with that more encompassing bottom line it’s all about audio delivery. Amazon, Apple, and Google can leverage music as a retention value in their vast ecosystems of consumer electronics, online services, and retail.

Billboard reports that the new rumored service might be announced as early as next week.

Brad Hill