Amazon now lets you listen to music free on smartphones and TV, as well as online. Spotify investors are already nervous.

Clodagh Kilcoyne/Reuters

Amazon CEO Jeff Bezos

• Amazon announced on Monday that the company was expanding its Amazon Music offerings so that users can stream free music on their iPhones, iPads, Android devices and Amazon's Fire TV products, as well as online.
• The company published a blog post that said customers without a Prime membership or subscription to Amazon Music Unlimited could now access ad-supported music for free. Previously, this was only available to customers using Amazon Echo.
• Investors on Wall Street seemed to think the announcement spelled bad news for music-streaming market-leader Spotify. Spotify shares dropped 4.9% to $140.26 on Monday.
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Amazon is expanding its free music streaming opportunities to its users without a Prime membership, Amazon Music Unlimited subscription, or Amazon Echo. It may be gunning for Spotify's 248 million-strong userbase.

The company published a blog post on Monday, detailing what non-paying users could now listen to on Amazon Music.

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"Customers who do not yet have a Prime membership, or a subscription to Amazon Music Unlimited, can now listen to an ad-supported selection of top playlists and thousands of stations for free on their favorite devices," the post said.

The company currently offers a few different payment tiers for its music-streaming customers. Amazon Prime members have access to more than 2 million ad-free songs. By upgrading to Amazon Music Unlimited, at $7.99 per month for Prime members and $9.99 for non-Prime members, users have unrestricted access to the platform's music library.

Previously, the company offered a free, ad-supported version of its music service only for Alexa users on Echo devices.

Monday's announcement seemed to suggest that the company was looking to hook some of Spotify's millions of customers.The popular music streaming service's last report said it had 113 million subscribers, who pay $9.99/month, as well as a larger body of 248 million active users who can listen to the app's free ad-supported music.

But Spotify's free, ad-supported tier is still more developed than Amazon Music, allowing users to create playlists and play music on-demand from their laptops and desktops.

Wall Street Reacts

Spotify shares fell roughly 5% in regular trading on Monday as investors reacted to the renewed competition from Amazon.

Spotify currently leads the market in music streaming, outpacing Apple Music in the number of subscribers. Last month, the company beat analyst estimates on the number of its paid users and turned a surprise profit.

But both Amazon and Spotify may have more challenges to contend with in the future, as other companies begin to enter the music-streaming market. The Financial Times reported Sunday that ByteDance, the Chinese company behind the video app TikTok, was also in talks to launch its own music-streaming service.