YouTube, the world's largest digital repository of streaming media, will launch a subscription music service later this year. The service will get its own negotiating team and operating unit is set to overlap with new features coming to Google Play, the new Android music platform,
Google Play will allow users to buy, store, and sort a collection of tracks; but on YouTube's coming service, anyone can listen to tracks for free. Both services are said to be adding a subscription fee that will unlock additional features.
Some content creators would benefit from a subscription revenue stream in addition to ads.YouTube is already one of the most heavily used music services in the world, but it hasn't yet charged users. Instead, it sells ads against its music videos; a cut goes back to the record companies.
Major music labels have found that there is money to be made via streaming music services such as Warner Music Group, which has partnered with YouTube and Google.
Record companies are still negotiating how much of their content to give away and are still hashing out what aspects of the user experience will be free on YouTube's new service, particularly when accessed from mobile devices.
There is also the concern that under an all free model, listeners might get used to not paying for music like before and that revenue would be tied to the ad sales that fund the free content.