The business model of free on-demand music streaming services like Spotify is "silly," a rival told CNBC, adding to the controversy about the site sparked by artists such as Taylor Swift.
Sweden-based Spotify operates a "freemium" service, with a free tier and a monthly $9.99 charge for a version without ads. And Apple Music also said it would offer a three-month free trial.
But Anthony Bay, chief executive of radio and music streaming company Rdio, said the models employed by the likes of Spotify were cannibalizing the music industry.
"The idea that giving it away for free leads more people to buy is flawed. You will convert a large number of people who would normally pay for something to the free service," Bay told CNBC by phone on Thursday.