“Closer to the people”: how SoundCloud plans to interest musicians and audience

The company is going to introduce an alternative content monetization model – direct payments to authors. If action follows word, SoundCloud will change the entire streaming niche.

Photo: Joesef Key.  Source: Unsplash.com
Photo: Joesef Key. Source: Unsplash.com

What’s happening

In the market for streaming services, everything is complicated. They expand the audience and help musicians earn money while there are no concerts and no demand for merch. But the latter are not happy with the payments. Even famous indie authors get no more than 20-25 thousand dollars a year and almost entirely spend these funds on the preparation and recording of new compositions.

The situation is complex and affects almost all online platforms, including SoundCloud. However, his leadership is not afraid to take risks, makes difficult decisions and takes the initiative into his own hands – prepares to launch a new monetization system as soon as possible. According to Billboard, with its help listeners will be able to support musicians directly.

An example with the Chinese QQ Music, where donations have been working for a long time, last year voiced in Slate, hinting at the potential of this model for Spotify and its counterparts. But, Western platforms continued to operate in the old fashioned way: transfer income from streaming to labels, and those – to redistribute them among musicians, depending on the terms of the contract.

However, this approach raised questions even before the launch of streaming services. Over a decade of growth, audience expansion, and financial health, they have been unable or unwilling to present a solution and balance the situation. As a result, the stratification in the industry has become even more acute, and now this problem discuss already at the level of government agencies.

What is worth waiting for

For the past three years, SoundCloud has been acting by analogy with other streamers: it provides listeners with access not only to the open library, but also to the Go + service with 135 million tracks for $ 10 a month, and distributes the income among the authors depending on the number of streams of their compositions. Hence the corresponding criticism, as in some cases from Spotify.

To minimize risks, the team analyzes several ways to support musicians at once and promises to tell about the results before the end of the first quarter of this year. Even if she stops at “donations”, this step will most likely have to be coordinated with the labels – to convince them that the level of payments will remain, and the discontent of the musicians will subside.

Photo: Gilly.  Source: Unsplash.com
Photo: Gilly. Source: Unsplash.com

The new monetization system can be integrated with the service Repostwhich the company launched a couple of years ago. It is aimed at an audience of independent musicians and helps them work with streaming sites like Apple Music, Spotify and the showcase of SoundCloud itself. In the latter case, there is no commission, for other platforms it is 20%.

Music for everyone

SoundCloud recently announced a partnership with Twitch. February 18 platforms will host the Fortnite Championshipfeaturing eight selected musicians. It would seem, why share the audience with another platform? But the fact is, nearly half of SoundCloud users are video game enthusiasts and professional gamers who are very familiar with the capabilities of Twitch. Therefore, the collaboration does not pose a threat to the parties and the audience, and the championship is highly likely to become a regular event.

Partnerships and integrations with other platforms cannot be ruled out. This tactic looks promising today and could give SoundCloud an extra boost.


What else to read in our blog on Habré and in the “Hi-Fi World”:


Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *