Amazon Prime Music currently has roughly 20 million listeners
Echo devices could help Amazon boost subscriber base
Amazon Prime Music's biggest competitor is Spotify
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Amazon, it seems, might be launching a free Amazon Prime Music service, albeit with a few limitations. The news comes via Billboard who says the company has entered talks to offer free music streaming with a limited catalogue which will be supported by advertising, in a big to take on Spotify.
Amazon’s move to offer a free tier would help the company increase its user-base, which is estimated to be around 20 million. Amazon, unfortunately, does not share specific numbers, which is made harder by the fact that subscribing to Amazon Prime in some countries gets users access to Prime Music, while in some other countries, subscribing to Prime Music gives users access to faster deliveries. As of now, the biggest subscription dependent streaming service, Spotify, also happens to offer a free tier which plays significantly to boost its subscriber base.
Amazon, if it were to go ahead with a free-tier, would be poised to greatly benefit from it. In an interview with The Verge, Amazon Devices Senior Vice President Dave Limp revealed that Amazon had sold more than 100 million Echo devices. This would lead to a best case scenario of a 4-fold increase in the user base of Amazon Prime Music, based on the free tier alone. This could even lead to conversion to paid subscriptions since users typically prefer to try a service before they buy into it.
In India, Amazon Prime subscription costs Rs 999 per year and includes all of Amazon’s best offerings; faster delivery, access to Prime Music and Prime Videos. After having tied up with various carriers, users end up getting a year-long subscription to the service for free. However, the challenge for Amazon lies in its overseas markets, where the company offers differential pricing, but no trials. For example in the U.S, you can either pay $119/year to get access to Amazon’s music service along with faster deliveries or just get Amazon Prime Music for $9.99 a month. Those who use an Echo device can sign up for Amazon Prime Music $3.99 as long as they listen to the service on an Echo device. A free tier would automatically boost the number of people using the service, hopefully, leading to paid conversions.
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