YouTube is planing to launch a music subscription service later this year, to allow people to listen to tracks online, and to possibly cut out the ads that precede each video for subscribers, according to Fortune. YouTube relies on selling banner ads on the site and running short clips before each video, giving a cut back to record companies.
YouTube has released a statement that confirmed it was considering a subscription service, but noted that ads wouldn’t go away:
“While we don’t comment on rumour or speculation, there are some content creators that think they would benefit from a subscription revenue stream in addition to ads, so we’re looking at that.”
A proper subscription service is likely to provide higher fidelity tracks, and elevates YouTube to the same playing field as labels such as Warner Music which do rely on streaming revenue. Google already has partnerships with numerous music publishers. Last November, it struck up a deal with Armonia, one of the largest alliances of music publishers, giving it access to 5.5 million tracks across 35 countries.
In December, it rolled out a free “scan and match” feature that allows users to add up to 20,000 songs from their offline collections to the Google cloud and stream it to their devices on the go. And in the larger scheme of things, the company might overlap its new subscription plans into its Google Play music service.
Source: Tech Crunch