Spotify will continue to have three tiers of service: Members can listen for free on desktops, and now on tablets, though they hear ads.
"Our belief is that the cost of the content cannot be fully offset by the advertising dollars you can generate," Mr. Irwin said, "and that the subsequent conversion of somebody to a paying subscriber because they've been able to listen to content for free on a desktop is not at a level that supports the losses you'll incur on the advertising side".
It is currently available for free on the desktop and runs in virtually any browser without the need to install an extra plugin beside Flash.
While Spotify can be downloaded and used or free on the desktop, users of Spotify will need to purchase content when they want to take music with them "on the go" via their iPod or iPhone.
Unlike All Access, which has a monthly fee, Spotify uses a "freemium" model; users can listen, with ads, for free on their desktop computers, pay $4.99 to listen ad-free, or pay $9.99 to stream and download unlimited music on multiple devices.
Rdio laid off some staff before Bay's arrival, after which he led the closure of its sister video site Vdo, the introduction of free streaming on desktops, and a redesign of the Rdio mobile apps that put the focus on the free radio.
Investors were clearly pleased with IBMs announcement that it plans to provide the Linux operating system for free on their server, desktop and laptop computers.
Pandora lifted its 40-hour cap on free monthly desktop streaming radio in September 2011, but Pandora CEO Joe Kennedy said recently that the company's mobile business is now "in a similar position to its desktop business a few years ago — it needs to make more money," which naturally runs counter to the company's long-standing mission to offer free music to everyone.
Free, ad-supported access was available on desktop and laptop computers, and for $5 a month users could remove the ads from those devices but not listen on mobile.
Chrome (Free) Google's Chrome browser has been a big hit on desktop computers.
