SoundCloud: Built from the Ground up

 

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http://www.bloomberg.com/news/features/2015-07-10/can-soundcloud-be-the-facebook-of-music-

Ask anyone who follows modern music if they have heard Drake’s song “Hotline Bling,” and you will likely get a unanimous “Yes!” However, far fewer would say they knew that the song was first released on SoundCloud back in July, 2015. Similarly, the popular podcast “Serial,” Lorde’s hit song “Royals,” and tracks from popular artists like Beyoncé and Snoop Dogg have all debuted on SoundCloud.

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Sarah Koenig, the host of “Serial” http://www.nytimes.com/2015/11/03/business/media/pandora-to-stream-serial-podcast.html

SoundCloud, the audio sharing and streaming platform, has both democratized and revolutionized the sharing of music. Soundcloud users have the ability to freely stream audio and upload the music that they create. As a result, SoundCloud has become the optimal environment for uploading novel sounds and the perfect testing ground for popular artists wanting to get a gauge of the public’s reaction to a new track. Additionally, SoundCloud’s grassroots approach to audio sharing has given many aspiring artists a chance to publicize their work and achieve a measure of fame and recognition. A great example is the Australian EDM artist who goes by the pseudonym Flume. He began posting remixes of popular songs and watched in amazement as his number of listeners quickly grew from thousands to millions. His fame did not provide him with income because SoundCloud pays little to no royalties to artists and labels. However, Flume’s tour and his songs featured in TV ads would have never become reality without the free publicity and the creativity encouraged by SoundCloud. Consequently, SoundCloud is the amalgamation of the styles, ideas, and innovations of its millions of users.

SoundCloud appears to be a well established company. It has 175million listeners each month, four times Spotify’s global following. Additionally, 12 hours of music are uploaded per minute and its millions of users are continuously expanding and redefining its musical archives. However, the company faces many challenges in its near future including allegations of copyright infringement and trouble raising capital.

There are many users who create songs using elements of other artist’s work. These remixes or mashups are what is called derivative work. Without a license from the copyright holder these users are violating the exclusive rights of the authors. As a consequence, legal action has been taken against SoundCloud by companies like the PRS, which represents songwriters. Karen Buse, executive director of membership for PRS, said, “If the streaming market is to reach its true potential and offer a fair return for our members, organizations such as SoundCloud must pay for their use of our members’ music.”

Above is a popular example of the type of remixes that pervade SoundCloud, but raise questions of copyright infringement.

SoundCloud has also struggled to raise capital. So since last year the company has been incorporating advertisements and letting artists and labels collect royalties. The end goal is to have a paid subscription that will let users skip ads, similar to Spotify. This move is in some ways a response to pressure from the music industry to produce revenue and license content. SoundCloud’s inability to make a profit also irritates record labels, which want to take advantage of its millions of users. SoundCloud’s future is bright, but before it can reach its true potential there are some challenges it must overcome first.

Sources:

http://www.bloomberg.com/news/features/2015-07-10/can-soundcloud-be-the-facebook-of-music-

http://www.nytimes.com/2015/02/26/arts/music/flume-rises-in-the-edm-world.html

http://www.nytimes.com/2014/08/21/business/media/popular-and-free-soundcloud-is-now-ready-for-ads.html?ref=business

http://www.nytimes.com/2015/08/28/business/media/soundcloud-sued-for-copyright-infringement-by-prs-for-music.html

6 thoughts on “SoundCloud: Built from the Ground up

  1. The embedding of songs directly into the post add a lot to the article by providing specific examples to strengthen your argument. Do you think the inclusion of a paid subscription service will hurt Soundcloud’s popularity? It seems like a lot of its appeal comes from the fact that it’s free and devoid of annoying advertisements. I know that it’s annoying when a service like Spotify interrupts your music with a commercial for some company you couldn’t care less about. In fact, ads on the internet have caused many to start using ad-blocking software, thus stifling the income of websites like Spotify and (potentially) Soundcloud. I wouldn’t be entirely surprised if this widespread practice led to such companies attempting more aggressive methods of turning a profit.

  2. Well done Thomas… I agree with Ryan about subverting ads and the corporate backlash, and further wonder about the SoundCloud community and how they will respond. One of its unique features, the ability to post a comment at a specific point in the audio, is one of the more attractive and socially driven features that might be hindered by commercials. I’m interested to hear what you think about the social aspects of the site as advertising is being introduced, especially in regards to independent artists who post their own music on SC.

  3. This article was really well written and very well formatted. The incorporation of music directly from soundcloud was an awesome idea and was very well-executed, and it really helped complement the paragraphs the audio followed/preceded. The use of statistics also really worked in your favor, and I like how you not only highlighted the feats of the website, but also the potential it has for defeats (i.e. not raising enough revenue). Overall job well done, you go girl.

  4. Thomas, I really enjoyed reading your article! Having used SoundCloud in the past, I believe it is a great service and the main reason I used it was because it was free and allowed me to easily find good music. I really liked your use of multimedia in this article. Being able to press play and listen to a song straight from the article gave me a better understanding of what you wrote about! If SoundCloud does move to become a subscription based service, I believe they may lose a lot of their current listeners. They also have two large competitors, Apple and Spotify, and I think many music listeners would only want to pay for one subscription service. I think is important that SoundCloud finds a way to make a revenue so that money is being put back into the music industry, however many users will probably be upset if they start charging for a service that was once free. I agree with you that SoundCloud is going to have to overcome some of these challenges.

  5. Gotta agree with everything written above–this article was very well written and you used the music embedded from SoundCloud very effectively. The progression and logic behind the article is clear and flows well, and I liked that you ended the article with a question that leaves the reader thinking. I think where SoundCloud differs from services such as Pandora and Spotify is that it does not necessarily have all the “official” music on it that one can get from other music subscription services–instead, it features a higher volume of smaller artists and remixes, so I think it will be even harder for them to ask users to pay to use their services.

    • SoundCloud is unique because the majority of the audio uploaded to the site comes from original and creative mixes, which are exclusive to SoundCloud. I think this gives it an advantage over services like Spotify and Apple Music, which license songs from already popular artists. I think this would be part of the appeal for choosing a paid SoundCloud subscription over a service like Spotify. However, I do agree that part of the appeal of SoundCloud is its free and unregulated nature. It would be interesting to see what kind of effect the implementation of a paid subscription would have.

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