Report: Amazon exploring on-demand streaming music service

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Amazon (NASDAQ:AMZN) is the latest digital media giant reportedly considering a streaming music service, following speculation that both Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG) are both readying efforts to challenge established players like Spotify, Pandora and Rhapsody.

Multiple sources have told The Verge that Amazon is in formal talks with various record labels and music publishers to explore an on-demand, multi-platform streaming service similar in scope to Spotify, the de facto market leader. Few other details are known, and an Amazon spokesperson declined to comment.

An on-demand music initiative would fit comfortably alongside Amazon's existing services and infrastructure. The online retail giant introduced its Cloud Player service in early 2011, enabling consumers across a multitude of connected devices to stream their own digital music libraries from Amazon servers. Cloud Player Free customers can store all MP3 music purchased from Amazon and import up to 250 additional songs from their PC or Mac at no charge. Cloud Player Premium, priced at $24.99 per year, allows customers to import and store up to 250,000 songs.

The Amazon MP3 store, which offers more than 22 million songs as premium downloads, also could integrate with the proposed on-demand service, enabling consumers to purchase the songs they hear.

Amazon also may feel it must roll out an on-demand streaming service simply to keep pace with Apple and Google, its chief mobile multimedia rivals. Rumors of Apple's streaming music ambitions first emerged last fall, when The Wall Street Journal and The New York Times reported the computing giant was mulling a multi-platform effort that would program content based on users' favorite artists, songs and genres, most likely taking the form of a preinstalled application integrated into Apple devices like the iPhone and iPad. Soon after, Bloomberg reported Apple was deep in talks with record label partners ahead of a proposed first-quarter 2013 launch, and earlier this month, Reuters reported Apple CEO Tim Cook and Senior Vice President of Internet Software and Services Eddy Cue have met with Beats Electronics CEO and co-founder Jimmy Iovine to explore a potential partnership involving the audio technology firm's forthcoming Daisy streaming service.

Google's interest in entering the streaming music segment only recently came to light, but rumors suggest the company has not one but two services in the pipeline. Late last month, publications including The Wall Street Journal and Bloomberg revealed Google is currently in talks with major record labels to license their catalogs for a premium service optimized for mobile devices and slated to go live as soon as the third quarter of 2013. While the initiative is designed to boost the consumer appeal of Google's Android mobile operating system, giving Android device owners expanded access to entertainment on the go, a source said services are expected to roll out to non-Android smartphones and tablets as well.

Fortune subsequently reported that Google's YouTube unit plans to launch a multi-platform streaming music service of its own, offering both free, ad-supported access as well as a subscription-based, ad-free option; Google currently monetizes YouTube by selling ads against music videos, awarding a cut of revenues to its label partners. It's unclear exactly how the two Google services would co-exist; a YouTube spokesperson said "While we don't comment on rumor or speculation, there are some content creators that think they would benefit from a subscription revenue stream in addition to ads, so we're looking at that."

For more:
- read this Verge article

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