Amazon and Pandora are readying new music streaming services for launch in the coming weeks, The New York Times reports, with both companies planning to undercut competitors like Spotify and Apple Music by charging as little as $5 a month for subscriptions. Pandora’s service is set to launch first, the NYT reports, its cheaper subscription arriving as soon as next week, while Amazon is expected to offer a $5-a-month streaming option to owners of its Echo speaker weeks later.
The Wall Street Journal detailed Pandora’s plans for expanded its music streaming services last month, reporting that it had recently initiated talks with music labels in a bid to offer full streaming catalogs. Pandora made its name with internet radio, but the WSJ said it’s aiming to build on that platform, adding another two subscription tiers that would see its free radio service joined by an ad-free version for $5 a month that lets users skip a certain number of tracks, and a $10-a-month option closer to existing competitors like Spotify and Tidal. According to the NYT, Pandora hopes to offer this full subscription service by Christmas this year.
Like Pandora, Amazon is reportedly planning to launch its own fully featured music streaming service for $10, but — according to several people briefed on the matter — will only charge half that for owners of its Echo speaker. The subscription would feature a wider catalog of music than offered under Amazon’s existing Prime subscriptions, but it’s not clear whether Prime subscribers would get access to the new music service as standard, but it seems likely that they would need to pay the $5 or $10 a month in addition to their Prime subscription.
The realities of negotiating licensing deals with record labels have ensured that most streaming services have coalesced around the $10-a-month price point, despite Apple’s attempts to offer its own service for $8 a month. Other attempts to heavily undercut the competition have failed — Rdio shut down last year after its $4-a-month subscription couldn’t keep it afloat — but by offering discounts alongside standard music streaming services, Amazon and Pandora may be able to differentiate themselves in an increasingly crowded marketplace.