SoundCloud’s ambitious goals for being the place where people share and discover music has always left it with a challenge. On one hand, it has to keep encouraging you to upload music – your tunes, your remixes, your DJ sets. It can’t just be a site for major label content, because then it loses to Apple and Spotify by default. On the other, it has to satisfy the needs of right holders – including when you upload music that they own. That’s an issue with your DJ set, of course, but it could eve be an issue with your own music, if you’re signed to a label.
Musicians and DJs have often assumed that these two interests conflict, but that’s not necessarily so.
First, the more SoundCloud attracts popular, major label content, the more likely it is that people listening to that content will find your music, too. That’s true in theory, anyway – and SoundCloud’s discovery algorithms are specifically tuned to introduce other music. SoundCloud has popularized a breakthrough track here or there, and there’s even word via Chance the Rapper that streamed music (including SoudCloud) could be up for Grammy awards. So this is really a thing.
Second, SoundCloud’s legal battles have actually made it easier for DJs and producers to upload their music without annoying takedowns.
But the ultimate prize is, SoundCloud will pay you for streams. That on its own might not be relevant, but SoundCloud gives individual artists far more control than Apple and Spotify. Only SoundCloud lets you upload content directly, at will, and the statistics and social controls available far exceed anything else. So combined with the ability to get paid, even a little, this is a big deal.
Obviously, the way this works is for SoundCloud to use its paid options (and presumably advertising revenue, though we’ve not seen a lot of that) in order to direct funds to the artists.
The details are a bit sketchy, and the rollout isn’t instantaneous. (That’s unfortunately been a pattern with SoundCloud, though I don’t know to what extent to blame the Berlin company and to what extent to fault the byzantine entities of the record industry.)
Basically, what SoundCloud are announcing is that the Premiere offering will soon be available to DJs and producers. For now, you can sign up; there’s no word yet on who will get included when.
Maybe the most interesting detail here is actually that SoundCloud specifically calls out DJ mixes (that’s the first time they’ve done that on the record, officially), and remixes. The sets are a big deal, because licensing them has been a hurdle in the past. And while Mixcloud ostensibly offers better tools and more solid licensing, I’ve never once talked to a DJ who was as happy with the plays and engagement they got on Mixcloud as they were with SoundCloud.
Here’s the signup:
The news comes at an interesting time. It seems increasingly likely that SoundCloud could soon face heated-up competition, especially as DJ mixes spread. Apple took some (small) steps into that space as far as licensing, and more recently, Spotify purchased technology that lets it better identify songs and stems.
The acquisition alone is bad news for SoundCloud – even if Spotify doesn’t use the tech, they just blocked SoundCloud from getting to it. (And in acquisition-happy tech, sometimes even that’s the goal.) But it could also be the basis of Spotify adding features that compete with SoundCloud. I doubt seriously that you’d get a Spotify/SoundCloud mash-up, but it could cover something like DJ tech.
I’m surprised, though, that no one has speculated that a Spotify acquisition of SoundCloud could go hand in hand with buying Sonalytics, since the latter would shore up the legal basis of the former.
Meanhwile, there are the usual swirling discussions about SoundCloud running out of money, which we’ve heard now for years on a regular basis. Since the company was founded, it has routinely had to go ask investors for more cash to extend runway – to the point of maybe “runway” isn’t really the word for it any more.
In other words, running out of money isn’t news. It’s a question of whether investors want to keep investing. But I wouldn’t trust anonymous sources for reliable information there, which is what some more speculative sites of relied upon.
Getting bought would be another route, and all of this could simply have to do with negotiations and asking price. Some of this uncertainty I think isn’t just a reflection of SoundCloud and their business model, but the uncertainties of streaming music in general. Because performing rights organizations and publishers and labels effectively set their share of money, and consumers have set their expectations of what they want to pay so low, businesses get badly squeezed in the middle.
Anyway, it’s a good thing we’re musicians. We have none of that uncertainty – we know most of what we do won’t make any money.
But I’m totally biased. I’m rooting for SoundCloud because they provide tools for musicians that no one else does, for the moment. And this move makes the stuff they make for us more useful. And for all SoundCloud’s flaws, right now, we need all the tools and control we can find.
I will see if we can get SoundCloud management to go on record about any of this; stay tuned. At press time, SoundCloud promised some additional follow-up; given the public announcement, it seemed to make sense to go with this story – we’ll provide updates available. -Ed.