YouTube has announced its long awaited music streaming service called YouTube Music Key. Within the existing YouTube mobile application, the new music section has been given prominence and recommends music videos and playlists based on historical choices or what is currently trending. It's starting as an invite-only beta service: People who are invited are offered 6 months free, followed by a promotional lifetime price of $7.99 per month.
Music content gives YouTube a monetization strategy as users are now able subscribe for an ad-free experience, a subscription to Google Play Music, and the ability to play music offline. YouTube is jumping into a crowded space, going head-to-head withApple's iTunes and Beats music, Spotify, Amazon's Prime Music service, among others. The company has the advantage of its massive built-in audience for music videos in particular: It's a go-to destination for people looking for a song. The challenge: People are used to YouTube being free—will they want to play?
Implications: YouTube is regularly the place where music discovery can happen very naturally, and often where rare and unreleased music can be viewed and shared easily. Despite being late to the music streaming party, embedding within the existing app not only leverages existing data, but also means they already have an existing install base from which to start. Time will tell how well successful this will be, but following the Taylor Swift vs. Spotify issues, YouTube could succeed in providing a streaming service that works for all parties… particularly the consumer!
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