The company wants to launch the first version of the service in an incredibly polished form that will help it stand out against competitors like Spotify and Rdio, which have been around for a while and have had several iterations of improvements. “They feel that there’s just too much scrutiny of this product, and that they need to get it right out of the gate,” said a senior label executive speaking to Billboard. This, of course, contradicts the strategy of YouTube’s parent company, Google, which launches services left and right in beta form, many of which get shut down relatively quickly.
One of the issues YouTube is facing with its music streaming service is how to present songs that don’t have official videos to the user. Early internal betas of the service have shown static artwork with facts about the artist/band and the song. YouTube has also been considering using an “art video” for those songs, which would display dynamic pictures or generic stock video.
Another challenge YouTube is coping with is how to integrate its music streaming service with its already existing video service. YouTube’s video service is the number one way that listeners aged 12 to 24 years discovered new music. One of the ways YouTube plans to differentiate the existing, free video service from the upcoming music service is by allowing users to build up libraries of music and playlists with different ways to sort and organize the media.
Finally, YouTube has to figure out how to present the premium music service as an enticing addition for consumers to the free video streaming service. Currently, YouTube plans to offer a $10 per month service with no ads, in addition to an ad-supported version for $5 a month. “They want to have something that can seamlessly complement what they currently have,” said a YouTube content partner.