Spotify shares pummeled after reports that Amazon is launching a rival free music service

 Eight-year-old Sutton Philips, left, his brother, 10-year-old Greyson Philips, center, and their mom, Liz Philips, right, play a game of rock-paper-scissors with "Alexa," their Amazon Echo wireless speaker and voice command personal assistant at their home in San Diego's Scripps Ranch community
The service will work via Amazon's Echo voice-controlled speakers Credit: San Diego Union-Tribune/Howard Lipin/Alamy

Shares in the music streaming company Spotify have fallen by 4pc after reports emerged that Amazon was planning to ambush it with a rival service.

The shopping giant could launch its own free, advertising-funded music streaming service as early as this week, accessed through its voice-controlled Echo speakers.

The service would allow users to request songs from its voice assistant, Alexa, and would be the first time Amazon has allowed its users to listen to music for free.

It indicates Amazon's intention to muscle in on the intense competition between Spotify, founded in Sweden in 2006, and Apple, which has used its prime position in the smartphone market to market its own music subscription...
