Subscription music services have yet to profit but that hasn't stopped some of the internet's biggest media distributors from jumping into the business. Amazon, the web's biggest retailer, is the latest to inquire with various music companies about starting a subscription service.
Details are few and the talks have been described as very informal, the sources said. But so far, what Amazon has shown an interest in is an on-demand service that sounds pretty similar to Spotify, generally considered the sector leader. Others in the field include Rdio and Rhapsody, but Google and Apple are also working on their own projects. Google is reportedly in talks with record companies and music publishers about starting subscription music services for both YouTube and Google Play. The Wall Street Journal reported that Apple is in negotiations for a Web radio service that sources say would be similar to Pandora's, one of the top webcasters.
All the signs point to an arms race in the online music sector and Spotify likely touched it off. The Stockholm-based company has seen big growth and now has 6 million paid subscribers worldwide after adding 1 million since December. Spotify offers a free, ad-supported service and then charges up to $9.99 per month for an ad-free plan. The company said that it has a total of 24 million active users worldwide. What's going to be interesting to see is how all these companies differentiate their services. An Amazon spokesperson declined to comment.
If Amazon decides to launch a subscription music service, it already has much of the infrastructure needed, including cloud music storage and its Cloud Player, which allows customers to stream songs from Amazon's servers.