Amazon Prime Music Takes Another Baby Step

If you've been following this blog for any length of time, you know that I've been saying all along to watch out for Amazon Prime Music as the next big disrupter in the streaming music space.

Why? Prime Music is part of the popular Amazon Prime subscription service that already has a reported 75 million subscribers (although Amazon isn't saying just how many). Amazon is also dabbling in its own record label, and is generally getting into the mainstream music distribution waters one toe at a time.

Well, maybe two toes, as the company recently dropped a few new nuggets of what might come next.

First of all, T-Mobile must added Amazon Music to its data-free music streaming program called Music Freedom. This is the first instance of Prime Music being available to off-the-platform users.

What might be more an indicator of the future is the fact that Amazon just made it's Prime Video service available as a stand-alone product for $9 a month. For $11 a month you could also buy the full Amazon Prime membership complete with Amazon Prime Music and 2 day shipping (which is more expensive than just paying the $99 a year fee for the same thing).

Although this last move has little to do directly with Prime Music, it's another baby step in the direction that we inevitably know Amazon will take. Don't be surprised if there's a big announcement about a free-standing Prime Music service in the next few months.

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Despite Reports, Don’t Look For Pandora To Be Acquired Anytime Soon

Is Pandora really up for sale? If it is the timing is extremely curious.

Pandora was said to have begun talks with Morgan Stanley to help it find a buyer, according to an initial article by the New York Times, although the talks were deemed preliminary and had no guarantee of a deal. If you look deeper into the company’s pros and cons, a sale looks a lot more fantasy than reality though, at least in the near future. 

While much of the press has focused on the financial part of a possible sale, let’s look at what may be some of the more intriguing aspects of a possible sale.

Where’s the match? 

There are only a handful of deep-pocket companies that might take a even cursory glance at a Pandora acquisition, but most are not a good fit. For instance, Google’s name is frequently mentioned as a possible Pandora suitor, mostly because of the synergy with it’s ad network, since most of Pandora’s revenue comes from ads. That said, there’s really nothing about Pandora that Google doesn’t either already have, or can’t get for less money.

Apple is another that doesn’t need what Pandora has to offer. It already has the same infrastructure for its iTunes Radio, and chances are that most of Pandora’s subscribers are already iTunes users. There’s not much that Apple would find attractive.

iHeart Media could probably find a space for Pandora among its current online radio properties, but the company reportedly has a huge amount of debt and would find it tough to swing a sale that would probably cost it around $2 billion.

Some think that Samsung might be a fit based on the company’s need to keep up with Apple in the smartphone market. The problem is that it already has a similar service in its Milk Music which hasn’t gotten any traction in the U.S. Pandora could instantly give it that traction, but to what end? Does the addition of an on-board music app make that much of a difference to the average smartphone buyer? In a word, no. Samsung would be better off pouring that $2 billion or so into R&D than adding a music app that could be obsolete in the blink of an eye.

Then there’s Amazon. I’ve been predicting for the last year that Amazon would be the next deep-pocket company to enter the streaming music market in a big way, as it’s basically there already with its Amazon Prime Music service for its Amazon Prime members. Reports have recently surfaced that the company is getting ready to introduce a mainstream streaming service not tied to Amazon Prime, and Pandora could actually be a useful addition if that were the case.

Read more on Forbes.

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5 Bold Music Business Predictions For 2016

The new year is upon us, which means it’s time to look into the crystal ball to foresee what might happen in the music business in 2016. Here are 5 predictions that may not be very popular, but might end coming to pass.

Prediction #1: Pandora goes global
One of the most significant and generally overlooked moves of 2015 was Pandora’s bid on some of Rdio’s streaming assets out of bankruptcy. While this move is still contingent on the court, acquiring this infrastructure will allow Pandora to become an interactive service like Spotify, and allow it to begin servicing other markets besides the United States as a result. With a solid 80 million user base in the US alone (which is what Spotify has globally), setting up shop worldwide will allow Pandora to become a true rival to Spotify.

Prediction #2: Vinyl shows its last big growth spurt
Vinyl sales have seen double digit growth for about 5 years and that will continue in 2016 as well, thanks to increased pressing plant capacity brought about by newly manufactured presses (the first in over 30 years) and widespread availability of turntables so buyers can actually listen to their purchases. Although sales will continue to increase beyond 2016, they’ll be much more modest as the number of new buyers diminishes due to saturation of the market. 2016 will be the last year of the true vinyl “revival.”

Prediction #3: Amazon Prime Music makes a move
Amazon Prime Music has been a minor add-on to a Prime subscription until now, but that doesn’t mean that Amazon isn’t taking music streaming seriously. The company has  all the infrastructure it needs to launch a mainstream music-only service, and 2016 will be the year it does so. Amazon has also been dipping its toe in the water of becoming a full-fledged record label with its occasional offerings from Amazon Acoustics, which could potentially signal what might be a major part of the service and could be a differentiator in a crowded market. Read more on Forbes.

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