Spotify stock falls after company announces new free mobile app

Music-streaming service Spotify Technology SA announced Tuesday upgrades to its free tier of service. The company said at a New York event that it would start giving free users the ability to listen to certain playlists on demand. Previously, Spotify's free tier mainly allowed users to listen on shuffle mode to playlists they created on their desktop computers. The new mobile app will allow users to listen on-demand to 15 playlists, including the popular Discover Weekly playlist. The new mode is the result of new licensing deals, according to Spotify's research-and-development chief Gustav Söderström. "Spotify is not really in the business of giving access to music," he told members of the press. "We're in the business of discovery. We think most of the others are still in the business of just giving access." Söderström also announced new tools for playlist creation as well as a low-data mode that he said will reduce data consumption by as much as 75%, "making true mobile listening affordable for everyone." Söderström said that the free tier is important for Spotify, as 60% of premium users once started as free users, though he also said that Spotify's goal with its new service wasn't to create "pain" for free users so they'd start paying up. Spotify shares are down 1.5% in Tuesday morning trading, while the S&P 500 is up 0.3%.