Amazon Music About To Launch A Free Ad-Supported Tier

Almost all music services expect Spotify rely on fully paid subscriber tiers, but Amazon Music may break the ranks soon with a new free ad-supported offering, according to Billboard. This could mean that Amazon is finally making a proactive move into increasing music subscribers instead of worrying as much about its Prime service.

The report also claims that in order to get the new licenses for the free music, Amazon has taken the unprecedented step of offering to pay some record labels on a per stream basis, instead of a percentage of the advertising revenue.

This signals that Amazon is truly focused on increasing its music subscriber base. Amazon doesn’t report the number of paying music subscribers it has, but there’s some speculation that the number may be in the 20 million range. That said, it’s also been reported that the company has as many as 120 million Prime subscribers, who also have a limited number of music offerings available to them included in the package. It’s unknown exactly how many take advantage of that feature though.

Amazon has numerous music tiers already besides a Prime membership. Amazon Music Unlimited subscriptions go for $9.99 a month and are available for $7.99 for Prime members and $3.99 a month for people who listen just on its Echo smart speakers.

In fact, the real reason why Amazon may be interested in a free tier is to drive more sales of its Echo hardware, which has a higher profit margin. This is the strategy used by Apple for years, where its operating system and software drove its profitable hardware sales.

Word is that the new tier is close to launching, which may come as soon as next week.


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