The on-demand music streaming market is getting increasingly crowded. Spotify had a head start on just about everyone, but Apple (
Now Amazon (
Other companies have tried to break the $10 per month barrier before, believing a much larger portion of the market is willing to spend somewhere between $5 and $10 per month on unlimited music streaming. Only Amazon has been able to pull it off.
Amazon is willing to take a loss
Even at an effective rate of $6.58 per month, Amazon is still sending about $7 per month to record labels. (That's the same as its competitors send for their $10-per-month services.) On top of that, Amazon has operating expenses for the service. (But considering it owns the cloud infrastructure it runs on, it gets a bit of a discount.)
The key to the whole operation is Amazon Prime. That's one of the secret weapons none of Amazon's competitors have.
Pandora and Spotify have millions of free users to funnel into their paid services. But neither of them are willing to take a loss on their paid service. It's their premium offering, and should, therefore, have...