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Amazon: One Industry to Rule Them All?

For once, Amazon is playing catch-up.

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  • Music Unlimited, which provides more songs for a monthly fee.

. . . Amazon’s achievement is even more impressive than it first appears. Amazon’s music streaming adoption is concentrated among 4 of its Amazon Prime markets: US, Japan, Germany and UK. In these markets 35% of Amazon Prime subscribers are Amazon Prime Music or Amazon Prime Music Unlimited users. Most music subscription services think about their addressable market in terms such as total smartphone users with data plans, or in Apple’s case in terms of iTunes account holders. In both those scenarios subscribers have to be converted into paying users. But all Amazon has to do is persuade its 40 million odd Prime subscribers to start using its music app. Many of you will have seen blanket Amazon Prime Music advertising recently. Think about it. All that those ads have to do is persuade existing Prime subscribers to start using the music app for free, no new payment, no new commitment. It is as easy a sell as you could wish for. So, expect that 16 million number to grow strongly over the coming months.

Until recently, Amazon did not distinguish itself, though. Spotify has always been noted for its vaunted use of machine learning to offer the best personalized music recommendations in the industry. Apple is known for offering not only songs but also original content through Beats Radio, where artists such as Kendrick Lamar and Father John Misty appear. But on February 8, Amazon played its ace in the hole: the Alexa voice assistant. Amazon announced that it will make it possible for customers to create Amazon Music playlists with Amazon’s Alexa voice assistant, which is embedded in Amazon devices, most notably the Echo. I predicted this development in 2017, as it seemed inevitable that Amazon take advantage of synergies between the Echo smart speaker and Amazon Music.

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Writer and pop culture lover.

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