YouTube is planning to launch a music subscription service. Considering how many songs are uploaded (not always legally) and played on YouTube now, this was a logical progression for the company. The service would be similar to Spotify, with the user paying a few bucks for unlimited music streaming without ads. Right now, most official music content on YouTube has a slew of ads before, and sometimes during, the video. While it does seem like a useful service, YouTube is running into issues establishing licensing deals.
Some independent labels are refusing to sign the licensing deals, claiming the prices set by YouTube are unreasonable. In a move reminiscent of Amazon's negotiating strategy, YouTube is threatening to block content from these labels that are resisting the licensing agreements. Their videos would become completely unavailable on YouTube general channels, if they don't sign onto the music subscription program — a very harsh tactic by YouTube. Beyond blocking their videos, YouTube would also stop paying the labels advertising revenue from the videos of users that feature the labels' music in the background. This is an important source of income for independent labels.