YouTube Unveils New Subscription Service 'Music Key'

New service will allow users to store videos offline and play music while using other apps

YouTube's long-awaited song-streaming service, Music Key, will launch Monday in a beta-test mode for "a limited group of people who play the most music on YouTube," a company spokesperson tells Rolling Stone. The ad-free service, which will expand to the public sometime in 2015 at $10 per month, will focus on mobile devices and allow users to play music while simultaneously using other apps and cache videos for offline use.

YouTube has been working on launching its entry into the growing music-streaming market, which includes Spotify and Beats Music, for more than a year. It hit a snag in June when reps for top independent record labels accused YouTube officials of offering "significantly less" in song-licensing rates than major labels such as Universal and Sony received. However, the Financial Times reported that YouTube recently made a deal with Merlin, a rights service representing thousands of indie labels.

"We've signed deals with every major label and hundreds of indie labels worldwide to make these features available," Christophe Muller, YouTube's global head of music partnerships, tells Rolling Stone. "We didn't expect this to happen overnight."

"We are very pleased that the world's leading independents, as represented by Merlin, are part of this new phase of YouTube's evolution," Merlin CEO Charles Caldas tells Rolling Stone. "We wish YouTube much success in the development of the new subscription features and of the service as a whole."

Music Key won't alter the traditional video site, which draws more than 1 billion users every month, or its mobile app. It will, however, group tracks by artist and albums in a more streamlined way (mostly eliminating weird cover versions or lyric videos) that's similar to Spotify, Beats, Rhapsody and iTunes. It will also allow users to toggle back and forth to the Google Play service, which includes an iTunes-style download store.

The music-streaming market has become intensely competitive over the past year, given Beats' launch in January, Apple's purchase of Beats' headphones-making parent company for $3 billion and relatively new services by Amazon and Apple. Album and track sales have been dropping over the last few years, but streaming revenues grew by 51.3 percent in 2013, according to a report by the International Federation of the Phonographic Industry.