SoundCloud has announced that it will be expanding its free service to attract new artists. The company plans on using a combination of advertising strategies and paid subscriptions for revenue. This is the latest step in SoundCloud’s efforts to combat industry giants like Spotify, who dominate the streaming market share with their 99-cent tier subscription services
SoundCloud is a music platform that allows users to upload and share their songs. SoundCloud has recently announced the plans to expand its free services, in order to attract new artists.
According to the company’s chief financial officer, SoundCloud Ltd., the music-streaming platform that launched the careers of Billie Eilish, Post Malone, and other artists, aims to provide new services for free to lure more musicians to its platform.
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According to Chief Financial Officer Drew Wilson of Berlin-based SoundCloud, the company wants to allow music producers to post and distribute portions of their work for free. Mr. Wilson said the business is still working on its plans, but the price increases should go into effect in the first part of next year. SoundCloud presently enables users to submit up to three hours of music for free before charging them a $12 monthly membership charge. Currently, the firm charges artists for music distribution.
Mr. Wilson said of the company’s objectives, “It’s to encourage you to move away from being timid about being a creative.” SoundCloud anticipates that many free users may ultimately elect to pay for the platform’s services.
SoundCloud is different from other big streaming services like Spotify Technology S.A. and Apple Inc.’s music service in that it enables independent artists to post their own songs, monitor listener interaction statistics, and communicate directly with their fans. According to the firm, its platform has roughly 30 million active producers and 300 million songs.
Privately-held According to Mr. Wilson, who is also the company’s chief operational officer, SoundCloud is presently “on the verge of break-even” and aims to turn a profit by 2023. In 2017, the firm, which was started in 2007, came into financial problems, prompting it to lay off nearly 40% of its employees, or 173 people. In the same year, Temasek Holdings and the Raine Group LLC purchased a substantial share in the business.
According to a U.K. regulatory filing, SoundCloud produced revenue of €147.6 million, or $167.5 million, up 37 percent from the previous year. In 2019, it had an adjusted operating loss of €20.6 million, down from €25.1 million the previous year. According to SoundCloud, the company’s 2020 filings will be accessible at the end of the year.
In recent years, SoundCloud has made strides to provide additional tools and services to artists. Repost Network Inc., a Los Angeles-based firm that helps artists and music labels promote their music on various platforms, was bought by the corporation in 2019. Mr. Wilson said that the income earned by the distribution is split between SoundCloud and its clients.
Mr. Wilson said the firm is actively extending its business model to give higher-end marketing services by invitation to certain of its producers. “We’re looking for the next Billie Eilish both in our backyard and across the world,” he stated.
According to Mr. Wilson, the transition is intended to produce new income streams in areas like as rights and licensing agreements. SoundCloud is extending its partnerships with creators, but the business says it has no plans to create “record label-like arrangements with musicians.”
Mr. Wilson said that SoundCloud may pursue further acquisitions in order to accelerate its development by bringing on more artists to its platform. Deals that may help the firm develop its technology would also be appealing, he added.
The corporation has no plans to buy independent record companies. “In the future, we intend to form exciting and unusual relationships with independents,” SoundCloud added.
According to Mark Mulligan, an analyst at MIDiA Research, a media research and consultancy organization, what sets SoundCloud distinct from other streaming platforms is its connection with independent producers. According to him, this provides the firm access to millions of musicians who produce music but do not distribute it via major streaming services.
Mr. Mulligan said, “I believe if you look at where SoundCloud is today, it’s early in its path in terms of the things it might achieve.”
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Kristin Broughton can be reached at [email protected]
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SoundCloud is a platform that allows artists to share their music and connect with other artists. However, the company has been struggling in recent years due to its lack of revenue. Now, SoundCloud plans to expand free services to attract new artists. Reference: soundcloud owner net worth.
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