Mark Mulligan of Music Industry Blog and MIDiA Research reported Friday that Amazon Music is now the number three music streaming subscription service worldwide. There are 16 million subscribers for Prime Music and Amazon Music Unlimited combined. The subscriber count trails only Spotify and Apple Music. The data show that Amazon has 12% of streaming music subscribers globally with Spotify at 40% and Apple Music with 19%.
Amazon A Global Music Powerhouse?
Amazon’s rapid climb in subscribers has likely taken its rivals by surprise. Not only is it third, but it only needs to persuade Prime Members to use the service to keep growing its base. According to Mulligan:
Think about it. All that those ads have to do is persuade existing Prime subscribers to start using the music app for free, no new payment, no new commitment. It is as easy a sell as you could wish for.
In an email interview, Voicebot inquired whether this growth in subscribers will help Amazon wield music industry influence like Google through YouTube and Apple through its iTunes and Music services. Mulligan replied:
Amazon’s streaming growth puts it at the top table in terms of reach. However in terms of revenue and engagement it has some way to go to compete with Spotify and Apple…of course, Amazon has another tool in its kit: the Echo.
The Amazon Echo Has Strategic Importance
Studies of voice assistant users have continually shown that music listening is both a purchase motivator and a top three consumer use case.
Amazon Alexa users have access to Spotify and other streaming services through account linking. However, it is important that Amazon also has a way to capture that consumer attention with its own service. Mulligan thinks Echo could have a profound impact on streaming music subscription by appealing to older users that have not adopted smartphone-based listening.
Amazon Echo is an opportunity for Amazon to compete in streaming music’s next battle ground: the home. This will be crucial to unlocking adoption among older consumers and families. Smartphone based listening fits the use case of younger users well but not so much older consumers.
Mr. Mulligan’s MIDiA Research also reported that Amazon sold 3.3 million Echo devices on Prime Day last week and has more than 13 million devices in households across the U.S., UK and Germany. This is a large market for Amazon and it’s growing quickly. Whereas Apple is leveraging its installed iPhone base to grow Apple Music and Google has YouTube, Amazon Echo provides a ready user base for Prime Music and Music Unlimited. Echo still has a long way to go to catch up to one billion iPhone and YouTube users. However, the rapid rise among subscription Prime music users offers Amazon another asset to exploit in the voice assistant platform wars.