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Rdio is revamping its mobile app to better take on Spotify and Pandora

The Rdio music streaming service is preparing to release an updated version of its mobile app later today will place a new focus on its free “stations” feature as competitors like Spotify, Pandora, and Apple’s one-two punch of iTunes Radio and Beats Music crank up the pressure on the service. Rdio claims its free music library is as much as fifteen times bigger than those of competing apps. Like other online radio services, the new Rdio will automatically create playlists and stations from that library based on a user’s music preferences. Curated stations from musicians and other celebrities will also be available, much like in iTunes Radio.

In the face of growing competition in the streaming music market, Rdio, a four-year-old service that charges for online subscriptions, has moved into a new phase with abundant free music — as well as free music’s ever-present companion, advertising. Rdio, which is based in San Francisco and offers its music service in 60 countries, has been admired by technology and music insiders for its clean design, but it has long played second fiddle to Spotify and Rhapsody. Its change to a so-called freemium model — which lures users with free songs and then tries to sell them more extensive features by subscription — will help it compete against those services and others like Beats Music and Google’s Play Music All Access. “What we’ve learned collectively over the last few years,” said Anthony Bay, Rdio’s chief executive, “is that the most successful models are freemium models.” Spotify has 10 million paying users around the world, and Rhapsody has two million. Rdio, which was started by the creators of Skype, has never revealed its subscriber numbers, although they are believed to be much lower.

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