The idea of setting music saved to your phone as an alarm tone is already possible in most phones. The issue here is, if you are a Spotify user, you most likely do not have the song on your phone other than through the Spotify application. This means your phone cannot find your songs.
Proposition: Integrate Spotify music into the phone alarm applications so that (if you own premium and have a song downloaded) you can select any song as the tone to your alarms. Perhaps like other applications, you can browse Spotify online and select one song even if you do not have premium.
-cropping of the selected song so that you can select a specific portion of a song.
-apply this to ringtones and possibly other portions of the phone.
the more we move Into streaming services, the more Spotify should look into capitalizing any space where storing music locally on your phone is needed; it is becoming outdated.