Spotify is inching in on its goal to be a leader in digital music by rolling out its radio service onto the company?s iPhone and iPad applications that will compete with similar music services such as Pandora.

The radio feature has been updated to the Spotify iPhone and iPad app and lets users listen to more than 16 million songs. The feature is available to all users with an ad-supported version for non-paying consumers and an ad-free model for subscribers.

?As consumers increasingly use mobile devices, companies are increasingly looking to capture that market,? said Agata Kaczanowska, lead industry analyst and media specialist at IBISWorld, Santa Monica, CA.

?The entrance of Spotify [on mobile] shows that there is still room in the industry and is not saturated yet,? she said.

?No matter what, consumers are looking for something usable and accessible to hear all of their music through, which is a challenge of subscription-based models.?

Spotify did not respond to press inquiries.

Mobile competition
Via the updated app, Spotify?s new service lets consumers make play lists from artists, songs or albums. Users can also listen to radio stations by genre.

Consumers also have the option to rate songs that they like to personalize their music tastes. Songs that users tag as liking are added to a separate play list to help consumers find content more easily in the future.

Spotify is also banking on social media and recommendations playing a big role in how users discover new music. For instance, users can browse their friends? play lists.

Although there is not a maximum on access to mobile listening, users are limited to skip six songs per hour, which is similar to what Pandora offers.

The radio feature is available to all Spotify users with different ad models for paid and free subscriptions.

The free version of the app is supported by audio ads from brands including current Spotify advertisers Heineken, Chevrolet, McDonalds and Warner Brothers.

Paid subscribers can listen to the radio without ads. Paid users will also continue to have access to ad-free streamed services.

The radio service was rolled out on Spotify?s desktop properties in December.

Chevy is advertising in Spotify's new mobile radio feature

Battle to the top
The news positions Spotify as a closer competitor to Pandora, which offers a similar ad-based music radio service.

Previous to the announcement, only paid users had access to Spotify on mobile, pointing to the growing need from consumers to listen to music via their handsets.

According to reports, approximately one-third of Spotify?s users sign up for a paid version of the service after trying the free version, and by making mobile free to all users, the company is clearly aiming to convert users to paid subscribers.

Speculation over how Spotify will tackle mobile monetization has been a hot topic recently, but the company has taken a series of recent steps to prove itself in the mobile space.

For example, the company recently released an iPad app that let paid users listen to music on the go.

Additionally, an executive from the company revealed at the International CTIA Wireless 2012 conference  that the company makes mobile a priority with a device-agnostic approach (see story).

?Spotify is making substantial moves to position itself as the central hub for music streaming on the Web and mobile,? said Nadav Poraz, founder of WhoSampled, London.

?With Spotify apps, the play button and its API, Spotify has become a music platform that enables third-party developers to thrive,? he said.

?Spotify faces tough competition from other services making similar moves, but so far they've had the upper hand. This competition is healthy for the online music ecosystem as it continues to benefit from increased openness and connectedness.?

Final Take
Lauren Johnson is editorial assistant on Mobile Marketer, New York