Up To Speed: YouTube preps subscription music service, but is there anything really different? (Video)

YouTube is set to offer a music-subscription service, called YouTube Music Key, after striking a deal with smaller labels earlier this week. The New York Times reported that, for $8 per month, subscribers will receive extra features, including removal of advertisements. But the Times also added that the move may be seen as a reboot of its relationship with labels and artists, not just listeners, as the Google (NASDAQ: GOOG) unit has a reputation for paying very little in royalties. The service is expected to go through a limited "beta" release and then be available to the wider public next year, the report said.

The Washington Post explained that, in addition to YouTube music videos, subscribers will receive access to Google Play Music's subscription offerings, so it's not going to be in competition with its own corporate cousin. But that does raise the question of why a customer might choose the new service rather than Google's existing service, let alone Spotify, Pandora (NYSE: P), Apple's (NASDAQ: AAPL) iTunes Radio, or another competitor. In the short term, the Post said, YouTube Music Key will cost less than the other services' subscription price points, but is expected to rise to $10 per month eventually, just like the others.

The economics of selling music online are yet to be worked out in a way such that both artists and listeners win, but it appears that major players are slowly shifting consumers' expectations away from free to paid. The Wall Street Journal reported that, at this point, even the freemium model employed by Spotify and others may be on its way out as labels prepare to bet that the convenience of listening to streaming on-demand music through a trusted service is worth paying for. -- New York Times, Washington Post, and Wall Street Journal

David A. Arnott is assistant news editor with The Business Journals.