Last.fm tests free Internet radio service powered by YouTube

Last.fm may have been a pioneer of personal radio, but since its $280m acquisition by CBS in 2007, it’s receded from the spotlight even as its category became more important, first with Pandora in the US, and more recently with the radio features added to pretty much every major streaming music service. Yet for all the predictions that the service is on its way down the dumper, it remains a valuable stash of data on people’s listening habits.

CBS Interactive-owned Last.fm is testing a new version of its free Internet radio service that’s powered by YouTube music videos. Last.fm was one of the first streaming-music services to gain popularity, but it hasn’t been able to keep up with competition from Pandora, Spotify, Rdio, and others over the last few years. And like its brethren, Last.fm pays expensive licensing fees for its large library of songs. I’m guessing Last.fm’s decision to integrate YouTube had something to do with those licensing fees. If Last.fm listeners are fleeing for other services, it would be difficult to justify the cost of having a wide variety of music available. However, with the shift to YouTube, Google fronts the bill for that content licensing, provided the service embeds the video player into its site.