YouTube Red launches in Australia, but questions remain

YouTube's subscription service, YouTube Red, along with the company's specialised music app, launched in Australia on Wednesday, but the specifics of the deal it offers artists are still unclear.

Australia, the service's first market outside the U.S. since it launched in October, will be another opportunity for the company to find out whether people are willing to pay for YouTube.

A YouTube Red subscription offers ad-free content, the option to stream videos offline, the ability to answer messages without stopping play on mobile, and access to exclusive YouTube Original content from some of the site's biggest stars.

The subscription -- which costs A$9.99 per month until June 6, when it will jump to A$11.99 -- will automatically give users access to Google Play Music, and vice versa.

While the company could not announce any original Australian content in the works, it seems like there could be an appetite. About 90 percent of Australian YouTube content is watched abroad, Gautam Anand, director of content and operations for YouTube Asia Pacific, told Mashable Australia, compared to 60 percent globally.

YouTube's music app, which also launched locally Wednesday, optimises the site's existing music content with playlists and audio-only versions of videos if users are out and about. It's an addition to the company's suite of products that aim to streamline the YouTube experience, including YouTube Gaming and YouTube Kids.

The app is available free, but without a YouTube Red subscription, users will have ads and no access to its offline feature.

For Australians, a perennial problem on YouTube is geo-blocked content. T Jay Fowler, product management director for music at YouTube, told Mashable Australia the app should, for the most part, weed out videos in playlists that Australians cannot access.

He also argued that users will benefit from YouTube's deep content bench, which goes beyond the 30 million or so tracks held by streaming services such as Spotify. That's because there's plenty of content unique to YouTube: remixes, lyric videos, dance videos and live performances, for example.

Original image has been replaced. Credit: Mashable

Who is getting paid?

As soon as YouTube Red launched, questions were raised about whether artists and performers would get a fair deal. In the past, the platform has had a fraught relationship with musicians, particularly over the use of unlicensed tracks on the site.

In April, Christophe Muller, YouTube's head of international music partnerships, wrote an op-ed arguing the company offered a good cut to artists as part of its ad-supported model.

"The next claim we hear is that we underpay compared to subscription services such as Spotify. But that argument confuses two different services: music subscriptions that cost £10 [$14.61] a month versus ad-supported music videos," he wrote in the Guardian. 

"Like radio, YouTube generates the vast majority of its revenue from advertising. Unlike radio, however, we pay the majority of the ad revenue that music earns to the industry."

Partner revenue from ads globally has also grown 50 percent on YouTube for the third straight year, Anand said. "All of the growth we're seeing in viewership and the success of the ad-supported business is obviously benefitting our partners and creators as well." 

He added that YouTube Red was another way for the platform to help make money for artists and content partners, presumably by giving them a cut of membership fees.

While he couldn't talk about contractual specifics, Fowler suggested the deal YouTube Red offers artists is a healthy one. "On the subscription side, we're using the standard subscription rights that any streaming music service would use, but again, where the lion's share of the revenue goes to the artists," he said. 

Time will tell if Australia has the appetite for yet another subscription -- and whether Aussie musicians end up happy.

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