One of the news most awaited by music lovers has just been announced: Amazon is about to launch its new streaming service. That's not good news for Apple, Spotify, Alphabet and Pandora. However, it marks the latest example of changes in the digital media market. The launch also makes Amazon one of the most formidable and strongest competitors in the music streaming market.

AWS Cloud Hosted Streaming

Hosted in the AWS cloud, the service should cost US$ 9.99 per month (about R$ 40.00), and offers on-demand access to complete albums, with a catalog similar to that offered by its best-known competitors, from according to Reuters .

The e-commerce giant already offers a free music streaming service to Amazon Prime subscribers. Prime Music offers access to a few albums, but much of its back catalog consists of older releases, and the overall size of its back catalog is small compared to its rivals.

One of the main reasons Amazon invested in a streaming service was the surprising success of its Echo voice assistant . The company has not officially released the sales number, but it is estimated that the company may have sold three million units of the app . Echo offers access to Amazon Music Prime, which connects to Spotify for a premium music playback experience.

Amazon is entering the paid digital music space at a time of growing enthusiasm for subscription services. Apple Music has proven to be a success and has been able to garner over 13 million paid subscribers since its launch just under a year ago. Spotify has also seen continued growth and has over 30 million subscribers worldwide, many of them in Brazil.

A Youtube rival?

What may be another indicator of a next-generation service is the fact that Amazon recently launched a video service, available as a standalone product for $9 a month.

What amounts to a YouTube rival, Amazon Video Direct (AVD), while launched only with publishing heavyweights and no labels, provides an interesting outline of how to pay content partners. AVD gives partners the option to upload their content to Amazon Prime Video (available to tens of millions of subscribers), make it available for subscription through their Streaming Partner Program, offer the video for purchase, or make it available for all Amazon customers, which is supported by ads like on YouTube.

According to Variety, the Prime Video option pays video owners 15 cents an hour for copyright in the US and 6 cents an hour in other territories, the equivalent of $75,000 a year. In addition, Amazon will also pay partners a royalty of 50% of the price of video purchases and rentals. As with YouTube, Amazon will pay partners 55% of any advertising revenue received. Amazon will also distribute $1 million a month to the makers of the top 100 shows Prime members watch each month.

A record label too?

The company has also been acting as a record label, strategically releasing compilation albums through its Amazon Digital Services LLC website. The latest version is called summer songs and features a combination of newly recorded songs and music from artists such as Baio (from Vampire Weekend), Kate Voegele, Brandi Carlile and others.

All of these moves indicate that there's a lot going on behind the scenes at Amazon, and everything seems to point to the company going to hit the music streaming market in a big way.

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Sky.One Team

This content was produced by SkyOne's team of cloud and digital transformation experts.