Amazon is currently in talks with recording company executives to try and broker a deal to create a streaming music service, according to a report today by Re/code. While rumors about a possible streaming service have been around for a while, music industry sources said Amazon is now in more serious negotiations to get a deal done.
It would be a logical move for the company to leverage the existing library it has for its Amazon MP3 service, and would be in line with the company’s Amazon Prime Instant Video and Kindle Lending Library offerings. According to the report, Prime customers would get access to the service for free, like Amazon’s other offerings. It could also be a key new feature for the company’s rumored set-top box: that way, Prime subscribers could get access to Amazon’s entire streaming audio library in their living room.
Amazon is currently the only major tech company without a streaming music service. Apple has iTunes Radio, Google has its Play Music app, and Microsoft has Xbox Music. Launching its own streaming service would put Amazon on the same level as those other companies.
That said, Amazon’s own insistence on low prices could torpedo its ambitions. The company is asking for a significant discount on a streaming license in its negotiations, compared to the deals labels have struck with services like Rdio and Spotify. Still, the company has staff members who are experienced with landing licensing deals. Michael Paull, the head of its digital music division, was formerly a Sony Music executive, and Principal Content Acquisition Manager Adam Parness used to head up licensing efforts at Rhapsody.
A new streaming service would certainly be one way to get people to stay subscribed to Amazon Prime as the company looks to raise its price from $79 to $99 or $119. An earlier survey showed that while Amazon needs the price increase, it has to convince consumers that they’re still getting a good deal in order to maintain Prime’s current subscriber levels.
