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Amazon unveils music streaming for Prime

– Amazon is launching a music streaming service for its Prime members, adding yet another freebie to its popular free-shipping plan ahead of the expected unveiling of its first smartphone next week.

On Thursday, Amazon.com Inc. began offering more than a million tracks for ad-free streaming and download to Kindle Fire tablets as well as to computers and the Amazon Music app for Apple and Android devices. The service, called Prime Music, is likely to be integrated with an Amazon smartphone expected to be previewed Wednesday.

People who pay $99 a year for Prime can listen to tens of thousands of albums from artists including Beyoncé, The Lumineers and Macklemore & Ryan Lewis for no extra cost. By adding music, Amazon is hoping to hook new customers and retain existing ones on its Prime free-shipping plan, which also allows subscribers to watch streams of movies and TV shows and gives Kindle owners a library of books they can borrow once a month.

Steve Boom, Amazon’s vice president of digital music, said the service will pay for itself and isn’t part of the reason why the company raised the price of Prime from $79 in March – a move Amazon said would cover higher shipping costs. Instead, the company will benefit because Prime members tend to buy more from Amazon and remain loyal customers.

“If they come to Amazon for their music needs, they become better and longer-term Amazon customers, and we think that’s a good thing,” Boom said.

Seattle-based Amazon reached licensing deals with most of the top independent labels and major recording companies Sony and Warner Music, but failed to reach a deal with top-ranked Universal Music Group.

That means that while the service will feature artists such as Justin Timberlake, Bruno Mars, Bruce Springsteen, Pink and Madonna – it will lack music by Universal stars such as Katy Perry, Taylor Swift and Jay-Z.

The service also won’t have many new releases – and for major artists that could mean music that has been released within the last six months.

Universal didn’t reach a deal with Amazon because it disagreed with the value of the lump sum royalty payment on offer for the albums in question, according to two people familiar with the matter.

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