Spotify unveils a free music-streaming service for iOS and Android

The rumors were already doing the rounds, but Spotify’s Daniel Ek officially revealed full details of its big launch at a press gathering in New York and London today. And yes, it involves ‘mobile‘ and ‘gratis‘ – but with a small twist.

Last week, reports suggested that Spotify would be unveiling a new free version specifically for mobile, with licensing deals already inked with major recording companies. Thus far, Spotify has required users to sign up for a premium subscription to get the full ad-free version of the music-streaming service – and to access it on mobile phones and tablets.

With today’s news out of the bag, however, Spotify revealed that a free service will now include mobile phones and tablets, but it will involve shuffle mode only on phones – so it will be a radio-like experience where you don’t have full control over the order of play.

Basically, you can shuffle your own music, all the playlists you’ve created and playlists from people you follow. You can also shuffle an artist’s catalog – so it seems that you won’t be able to dig down into individual albums specifically. Naturally, there will be ads included in the free service, as is the case with all of Spotify’s free products.

Android tablets and iPads, on the other hand, will follow a similar model to the desktop and Web version of the service – but it will be ad-supported.

This is a big step for Spotify as it looks to boost its numbers across the board. Before today, Spotify’s reported figures were 24 million users, 6 million of which were on a paid plan. It hopes that if it can encourage more people to jump on board a free plan, it can ultimately shoehorn them into paying subscribers and rely less on advertising revenue. Given the prominence of phones and tablets now in the entertainment space, this is one way of gaining mindshare.

As things stand there isn’t too much to differentiate the various subscription-based music-streaming services which include Spotify, Rdio and Deezer, but a free incarnation for mobile would certainly set Spotify apart and offer a large carrot-on-a-stick for would be defectors of other services. Indeed, Deezer is already offering a special promotion for its Premium+ service which basically halves the subscription fee for mobile access. Is this a coincidence, or are they running scared? We’ll let you decide.

With a myriad of music discovery apps out there, iTunes Radio, Pandora, Deezer and Rdio, the competition in the space is fierce, so there’s no question that this offers a big incentive for would-be subscribers. Oh, and Led Zeppelin also arrived on Spotify today, in an exclusive streaming deal – that’ll be sure to please many too.

With today’s news, this means that Spotify now only has two tiers – Free and Premium. Those who were on the Unlimited service will be kept on that tier, but nobody will be able to sign-up for it anymore. The major incentive now for free users to jump up to Premium is to remove the ads and gain offline access.

The updated Spotify mobile service will be rolling out from today.