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News October 25, 2015

YouTube ditches Music Key, announces ad-free subscription service

Former Editor
YouTube ditches Music Key, announces ad-free subscription service

YouTube’s subscription service will receive an official launch on October 28 in the US.

YouTube Red, the new membership to offer users ad-free video, wasannounced Wednesdayand while it’s not available in Australia yet, a host of its features have been revealed.

YouTube Red allows users to watch offline through cached media, the app can play in the background of devices, it will feature original TV-style series’ and exclusive content from YouTube stars, and it will include a subscription to Google Play Music, which features a download store and cloud storage.

Offered for the now music streaming market-wide price of US$9.99 per month, YouTube Red may beat out entertainment platforms like HBO ($15.99) and Audible ($7.99), but according toMBW, its partner agreement doesn’t match Spotify or Apple Music. YouTube Red will pay rights holders 55% of total net revenues from YouTube Red subscription fees, while Spotify pays out nearly 70% of our total revenueto rights holders and Apple Musicclaimed71.5% goes to US rights holders.

Similar to how a download of the Spotify app works, users who purchase YouTube Red via the Apple Store will pay $12.99 per month, vs. $9.99 per month on desktop and Android. In July Spotify requested their users cancel their subscriptions if they were purchased via Apple: “Apple charges 30 percent on all payments made through iTunes,” anemailto subscribers read.

Perhaps most interesting to music fans is the promise of two dedicated music apps: YouTube Music for those who want to use YouTube videos as a back-end for music listening, and YouTube Play, a Spotify-like service featuring playlists, channels and recommendations.

Furthermore, the widely reported YouTube Music Key – the paid platform beta tested until recently – has been ditched and folded into YouTube Red.

The service is a clear move away from ad-funded hosting and while its dent in the music industry remains to be seen – reports suggest not all labels have agreed to its terms – it should take on media companies like Netflix and Presto with its TV-style content, expected to be rolled out in January.

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