Google Inc. is in discussions with the major labels about launching an online music streaming service that would position it to compete with Spotify, MOG and others, a person familiar with the matter confirmed.
The labels are in discussions with Google about renewing deals that pay the music companies a fee whenever one of their copyrighted songs is used in a YouTube video, said the person who was not authorized to speak publicly about the negotiations.
As part of these talks, Google is proposing a premium subscription service -- perhaps as soon as the fall of this year. The contemplated new offering was first reported by the Financial Times. A Google spokesman declined comment.
Google Inc.'s YouTube has emerged as a primary destination for young music fans, who come to the site to watch music videos and countless parodies. A popular YouTube video can catapult a song to the top of the music charts, as was the case with the "Harlem Shake," which this propelled little-known Brooklyn DJ Baauer's dance track to the No. 1 spot on Billboard's Hot 100.