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Amazon and Google launch free music services in challenge to Spotify

Matthew Field
Amazon will launch a free music service for Echo speakers - Amazon

Amazon and Google both have revealed free versions of their music streaming services, ramping up pressure on Spotify’s place as the world’s most popular music streaming app.

The two technology giants will launch their free services for their respective smart speakers: the Amazon Echo and Google Home.

Amazon will launch a free version of its Amazon Music Unlimited service for its Alexa-powered Echo devices, which will include advertising. The smart speakers will let listeners request songs using their voice. The free service will initially only be available in the US.

Google, meanwhile, will launch a free version of its YouTube Music service in 16 countries, including the UK, also supported by adverts.

The launches dial up the pressure on Swedish music streaming company Spotify, which until now was the only major music streaming service to offer parts of its app for free. Spotify has grown to more than 170m active users and has used its free app to entice consumers to pay for its paid-for Spotify Premium service.

Both Amazon Music and YouTube music will only let consumers use a limited version of their music apps and only play music from their smart speakers. Amazon said it will let users play songs from “an ad-supported selection of top playlists”, while YouTube Music will let users search by genre.

Amazon has quietly grown its music streaming app into one of the world’s largest, behind Spotify and Apple Music. Amazon has never confirmed its total paying music subscribers, although has said it has “tens of millions”. Analysts estimate Amazon has around 20m paying users.

On Monday, Spotify’s shares dipped on reports that Amazon would launch a free music product - the so-called “Amazon effect” where share sell-offs are triggered by the encroaching technology giant.

However, late on Thursday Spotify shares recovered around 1.5pc on what was seen by analysts as a soft launch by Amazon. Its free service will only appear on its Echo speakers as an incentive to new customers.

“It will probably have little impact on more established players,” MusicWatch analyst Russ Crupnick told Variety. “However, it may bite into Spotify’s advertising, if not its audience. This clearly fits in with Amazon’s larger advertising plans.”