Artificial intelligence (AI) will take center stage in 2023. With the advent of next-level generative AI systems, including his ChatGPT from OpenAI, many have had their first glimpse of what an AI-powered future might look like. what they saw. The ability of these systems to summarize information, write text, and generate images opens up a whole new world of technological advancements for both consumers and businesses.
But large tech companies – including Amazon (AMZN 1.59%) — We’ve relied on AI for years. Digital retailers have long used these sophisticated systems to track inventory, predict customer demand, recommend products to shoppers on e-commerce sites, and use Amazon Web Services, a cloud infrastructure platform. (AWS) as a basic service.
Now Amazon has quietly acquired a startup AI company to develop capabilities for its streaming music and podcast business.
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thin detail
Amazon said it acquired audio intelligence company Snackable.AI late last year to improve its podcast capabilities. new york postFounder and CEO Mari Joller has stayed on to lead AI and machine learning products for Amazon Music Podcasts. Terms of the deal were not disclosed, but Snackable reportedly raised her $3.1 million in funding, according to data compiled by Crunchbase.
Snackable.AI “uses machine learning to extract valuable data and insights from audio, enabling podcast-like recordings that are efficient and helpful for listeners,” said Joller. . She goes on to say that Snackable’s technology “solved a pressing problem: helping companies extract meaningful insights from large amounts of video and audio content (with much less effort).” . Joller now “leads a team of engineers, applied scientists, and computational linguists to build AI-powered products for Amazon Music Podcasts customers.”
This executive also has an interesting background in generative AI. Joller’s previous company, conversational AI startup alphachat.ai, was an automated customer service his chatbot focused on discovering the latent intentions of potential insurance customers. I described it as a “secret sauce”. His four-year-old start-up company zurich insurance December 2021.
behind the music
Subscription services have long been a slow-growing area for Amazon. This segment includes a series of listings of Amazon’s annual and monthly fee-based services, including Prime membership, digital video, audiobooks, digital music, e-books, and other subscription services (excluding AWS). included.
Digital music is the underlying gem that drives its growth. Estimates vary, but according to data compiled by MIDia, Amazon will have 82.2 million music subscribers in 2022, making him the third largest streaming music platform in the US. Spotify and appleAdditionally, Amazon’s listener base more than doubled between 2019 and 2021.
The company’s premium music subscription service, Amazon Music Unlimited, is growing exponentially, but the company doesn’t provide regular updates on its progress. The last official update came in early 2020, when Amazon announced that the music streaming platform had 55 million subscribers, a 50% year-over-year increase.
The company sought to capitalize on its growing listener base. Earlier this year, Amazon increased the price of its Amazon Music Unlimited plan from $9.99 to $10.99 per month, and the student rate rose from his $4.99 to $5.99.
Amazon made another strategic move late last year, making its entire 100 million-song music catalog available to Prime members (previously limited to 2 million songs), but only on Shuffle. We’ve removed ads from most of our podcasts at the same time. Podcasts are a key attraction for some listeners, and Amazon has moved to spark that interest by adding a Podcast Preview feature.” and help you find new shows that match your interests.
What will be the next big growth engine?not exactly
Podcasts were already growing in popularity, but as a result of the pandemic, they attracted a whole new generation of listeners. Adoption of podcasts is growing rapidly, from 275 million listeners in 2019 to 505 million viewers expected by 2024, compound annual growth rate of her 13%.
That growth is solid, but worth looking at in the context of Amazon’s overall business. Subscription services (including Amazon Music and its podcasts) accounted for less than $10 billion of Amazon’s $127 billion in Q1 sales, or less than 8% of total sales. Moreover, most of the revenue from that segment is undoubtedly the result of Amazon Prime subscriptions. And that’s probably the key.
Amazon tries to make the benefits of Prime subscriptions so compelling and compelling that customers won’t even consider canceling their membership. It’s well-documented that Amazon Prime shoppers are the company’s most profitable customers, so the company has a vested interest in retaining them.
that is what’s behind the music.
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Danny Vena has held positions at Amazon.com and his Apple. The Motley Fool has positions in and endorses Amazon.com, Apple and Spotify Technology. The Motley Fool’s U.S. headquarters has a disclosure policy.
