Amazon Music The Dark Horse Comes Out Of The Shadows

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The 20,000 Foot View: Back in the days when online music meant online CD sales, Amazon was the king. Then, along came Apple with iTunes music store and Amazon saw the throne snatched from its hands. No sooner had Apple started to enjoy its reign that Spotify came along to usurp the throne. Now streaming’s game of thrones is experiencing another plot twist, with a resurgent Amazon battling for supremacy with an ambitious streaming music strategy that owes a considerable debt of gratitude to Apple for strategic inspiration. Throughout the emergence of the streaming market, Amazon has played the role of a dark horse, skulking on the side lines. Now, Amazon is out of the shadows, and revealing its potential to be one of streaming’s biggest players.

Key Findings

• Global music subscriptions grew by        million to reach        million in June 2017 from        million in December 2016 
• Since        2014 Spotify has largely maintained its market share, while Amazon accelerated from        position to third place with        million subscribers 
• Of the top six streaming subscription services, only Spotify and Deezer are ‘pure play’ services, dependent solely upon streaming for revenue
• Amazon is ‘doing an Apple’ with its content, services and hardware ecosystem built around Prime
• Amazon’s household device focus makes it well placed to target the over        demographic 
• Over        make up just        of subscribers, under        the remaining       
• The battleground for home speakers will be among consumers aged        and upwards
• Amazon Prime Music employs the three Cs of digital content: context, curation and convenience
• Amazon Prime penetration sits at        in the US,        in Germany,        in Japan,        and in the UK. Echo penetration in the US is        and        in the UK 
• Amazon is converting its addressable market better than its competitors:        of Prime subscribers are Prime Music users
• With peak stream approaching in many major music markets, Amazon’s targeting of more mainstream and older consumers will be crucial for driving further growth

Companies and brands mentioned in this report: Access Industries, All Access Entertainment, Amazon, Amazon Prime Music, Anghami, Apple, Apple Music, Believe Digital, Bose, Deezer, Google, iPad, iPhone, iPod, iTunes, Kakao Talk, Kobalt, Leon Entertainment, MelOn, Music Glu, Panasonic, Pandora, QQ Music, Samsung, Sirius XM, Songkick, Sonos, Sony, Spotify, Tencent, Tesla, Warner Music