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Amazon Keeps Pressure on Apple, Bolsters Ecosystem

Wed, 08/01/2012 - 7:27am
Andrew Berg

Amid rumors of a possible smartphone offering to complement its line of eReaders and media tablet, Amazon continues to put pressure on Apple with its content and cloud-based offerings. 

The online retailer announced changes yesterday to its Cloud Player licensing agreements that bring significant updates to Amazon Cloud Player, including storage limits that are 10 times those offered by Apple.  

In light of new agreements with Sony Music Entertainment, EMI Music, Universal Music Group, Warner Music Group, and others, Amazon has raised the storage limits of its scan and match technology. 

Cloud Player Free customers can store all MP3 music purchased at Amazon, plus import up to 250 songs from their PC or Mac to Cloud Player, free of charge. 

Cloud Player Premium customers can import and store up to 250,000 songs in Cloud Player for an annual fee of $25. Amazon-purchased MP3s, including all previous purchases, do not count against the 250 or 250,000-song limits and will be added to both Free and Premium Cloud Player libraries at no charge. 

By contrast, Apple's $25 annual charge for iTunes match allows users just 25,000 songs before they have to purchase more storage space on the company's iCloud service. 

Additionally, Amazon today launched a new Prime Instant Video app for the iPad on the Apple App Store. The new app will allow Amazon Prime users to view Amazon's Netflix-like streaming video service on the iPad. 

The current version of the iPad app won't allow users to stream content from the app to an Apple TV, but given that Apple has brought both Netflix and just yesterday Hulu Plus onto its TV platform, Amazon’s Instant Prime is likely not too far behind. 

While Amazon’s current business model has it selling hardware such as its Kindle Fire tablet at nearly break-even prices in order to sell more digital content and physical goods, the company appears to be building the kind of seamless ecosystem of content, devices and cloud services that could compete with Apple. 

Amazon is said to be working with component suppliers in Asia to test a smartphone of its own, the Wall Street Journal reported in early July, bolstering the argument that Amazon might be making a very attempt to enter the same ring as heavyweights like Apple and Samsung. 

The Journal reported that mass production of an Amazon smartphone could begin later this year.

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