Amazon prepping possible online TV service; will it ever do music?

amazon primeVentureBeat reports that retail/media giant Amazon is talking with TV channels about possible online distribution. The online service would be an alternative to cable and satellite presentation of the channels.

Amazon is well positioned to make a play in that space, as it has built up its Amazon Prime service and membership over the past eight years. Amazon Prime was started as a free-shipping annual plan, and expanded to include Netflix-style movie and TV-show streaming. Netflix, Prime, and Hulu Plus are the three major players in that business, whose model parallels the music subscription niche.

Although Amazon is cagey about the size of Prime membership, some estimates confidently put the number over 20-million subscribers. That’s an interesting number, in the same league as Comcast, and eye-opening by subscription-music standards. If Amazon has more annual paying subscribers than all the major music plans combined, why isn’t it packaging music streaming into its Prime offering? It seems like an opportunity to steal share.

Of course, the question is glib, and easy answers come to mind. Licensing complexities. Cost of content. Competitive market that’s getting more crowded monthly. Amazon is perfectly positioned to compete with iTunes Radio — it has the same synergy with its music-download store that Apple has with its iRadio/iTunes linkage. But is Apple succeeding on that basis? The company has been silent recently, as market-leading Internet radio platform Pandora continues to grow audience.

One certainty is that Amazon Prime is a unique business, built on a titanic retail engine, but also embracing online media delivery. The company owns an immense global asset of billing relationships. Amazon uses its multiple dimensions to drive subscription sign-ups to a level at which the company is poised to expand media delivery in a number of directions.

Brad Hill