SoundCloud

Not to be confused with SoundHound.
SoundCloud
Type Privately held company
Founded September 2007 (2007-09)
Stockholm, Sweden
Headquarters Berlin, Germany
Area served Worldwide
Founder(s) Alexander Ljung
Eric Wahlforss
Key people Alexander Ljung (Founder & CEO)
Eric Wahlforss (Founder & CTO),
David Noël (VP Community & Evangelist)
Employees 190
Website soundcloud.com
Written in Ruby [1]
Alexa rank Increase 162 (October 2015)[2]
Type of site Social networking service, music website
Registration Required to post and upload content
Users 40 million registered users (July 2013), 175 million unique monthly listeners (Dec. 2014)
Launched October 2008, 8 years ago

SoundCloud is a global online audio distribution platform based in Berlin, Germany, that enables its users to upload, record, promote, and share their originally-created sounds. According to the company’s data, in December 2014, the service attracts more than 175 million unique monthly listeners, while content creators upload about 12 hours worth of audio every minute.[3] Founders Alexander Ljung and Eric Wahlforss are the chief executive officer (CEO) and chief technical officer (CTO), respectively.

History

SoundCloud was originally founded in Stockholm, Sweden, but was established in Berlin in August 2007 by Swedish sound designer Ljung and Swedish artist Wahlforss. The founders initially aspired to allow musicians to share recordings with each other, but the concept later transformed into a full publishing tool that also allowed musicians to distribute their music tracks.[4]

A few months after inception, SoundCloud began to challenge the dominance of Myspace as a platform for musicians to distribute their music by allowing recording artists to interact more nimbly with their fans.[4]

In a 2009 interview with Wired, Ljung said:

We both came from backgrounds connected to music, and it was just really, really annoying for us to collaborate with people on music—I mean simple collaboration, just sending tracks to other people in a private setting, getting some feedback from them, and having a conversation about that piece of music. In the same way that we’d be using Flickr for our photos, and Vimeo for our videos, we didn't have that kind of platform for our music.[4]

In April 2009, SoundCloud received €2.5 million Series A funding from Doughty Hanson Technology Ventures.[5] By May 2010, SoundCloud announced it had one million subscribers.[5]

In January 2011, it was confirmed that SoundCloud had raised a US$10 million Series B funding round from Union Square Ventures and Index Ventures. On 15 June 2011, SoundCloud announced they had five million registered users, as well as investments from Ashton Kutcher and Guy Oseary's A-Grade Fund.

On 23 January 2012, SoundCloud announced on their blog that they had reached 10 million registered users. A story wheel was created for the occasion, which can be found on the SoundCloud blog.[6] By May 2012, 15 million users were announced by the company at a press conference held in San Francisco, US, where the next version of the site was previewed. The usage level for the site was growing by 1.5 million users per month at this stage.[7]

At the start of December 2012, the new SoundCloud version was released to the general public. Heavily influenced by the tablet browsing experience and mobile devices, the enhanced platform offered new features such as: redesigned profiles; more sharing options; real-time notifications; continuous play, which allows concurrent listening and site navigation; the ability to create personal collections/sets; and the addition of real-time indexing to search.[7] The response from users was mixed, and many expressed dissatisfaction with the change. SoundCloud received over 60,000 comments regarding the new layout by 10 December 2012.[8] Also in December 2012, the company's data showed that SoundCloud was reaching 180 million people per month—8 percent of the global Internet—while users were uploading 10 hours of content every minute.[9]

In March 2013, Twitter announced SoundCloud as a third-party music partner, alongside iTunes, in developing the Twitter's first-ever integrated music app. However, the initiative never eventuated; SoundCloud's inability to load licensed music—due to the absence of arrangements with the major music labels—was cited as a major reason.[10][11] By July 2013, SoundCloud's registered users had quadrupled in number from the beginning of the previous year, with a total of 40 million, and an additional 20 million listeners were using the service on a monthly basis.[12]

SoundCloud announced in January 2014 that it had commenced negotiations with the major music companies, as copyrighted material consistently appeared on the platform.[13] The announcement was publicised after a round of funding in which US$60 million was raised, resulting in a $700 million valuation. The additional finances were suggested as the reason for the plan, as finalising such deals is a costly process.[11]

In March 2014, SoundCloud was reportedly in a second round of talks with major music labels about licensing after the January negotiations did not amount to anything substantial. According to media sources, the negotiation process was initiated in an attempt to avoid the problems faced by Google, which is forced to handle a large number of takedown notices on its YouTube video-sharing platform.[14] However, the outcome of the talks was not forthcoming in any media sources.

Later in May, the media reported that Twitter had regained interest in SoundCloud and was considering acquiring the platform for around US$2 billion. The next after the publicity of the deal surfaced, the prospect was no longer an active consideration. One media report stated that "the numbers didn't add up", while Bobby Owsinski claimed on the Forbes website in July[15] that SoundCloud's ongoing inability to secure deals with the major music labels was the foremost culprit.[16]

Monetization, subscription services

In August 2014, SoundCloud announced that it would begin to further monetize the service through a new partner program known as "On SoundCloud", which allows "premier" partners to monetize their content through advertising units, including pre-roll audio ads, sponsorship of channels, mobile display ads, and native content. The company announced deals with a number of content partners (including Comedy Central and Funny or Die), independent labels, and YouTube multi-channel networks, but stated that it was in "active and ongoing, advanced discussion[s]" with major record labels, and was planning to launch a subscription-based music streaming product in the future.[17]

Sources with knowledge of the company's next funding round spoke with the media in early December 2014 to reveal that ongoing discussions could raise about US$150 million in new financing, leading to a new valuation that would surpass the billion-dollar mark. Other startups that have crossed such a threshold include Spotify and Uber. At this time, SoundCloud claimed that 175 million unique listeners used the site each month, while about 12 hours worth of audio were being uploaded every minute.[3][18] The major label issue became prominent again when the new financing information was released, as the lack of monetisation was presented as an issue—SoundCloud had managed to sign an agreement with Warner Music Group as part of the new premier program that allows both Warner Music, which also has a minor stake in the company, and its publishing division to collect royalties for songs they have chosen to monetize on the site; meanwhile, the other labels remained skeptical of the company's business model.[3][18]

According to further information released in December 2014, the introduction of ads had allowed SoundCloud to share revenue with about 60 other Premier Partners, including independent labels and artists, who are invited to participate and receive special promotion rights. Although SoundCloud did not have paid subscriptions for ad-free streaming, they had planned to launch one in 2015.[3][18] Concerns over the amount of revenue from the program led Sony Music Entertainment to pull its content from the service entirely in May 2015.[19] In June 2015, SoundCloud announced that it had reached a deal with the Merlin Network, a group representing 20,000 independent record labels, to monetize their content through the premier partner program.[20]

In January and March 2016, SoundCloud reached respective deals with Universal Music Group and Sony Music Entertainment. A UMG spokesperson told The New York Times that the deal would give the company an option to require certain content to be restricted to paid subscribers—a statement suggesting that SoundCloud was preparing to launch its subscription streaming service.[21][22][23]

On March 29, 2016, SoundCloud launched its subscription music streaming service, SoundCloud Go.[24]

Features

Subscription services

SoundCloud Pro

SoundCloud offers premium services for musicians under the banner SoundCloud Pro. The SoundCloud Pro service allows users to upload up to four hours of audio, and adds additional features such as enhanced analytics, and the ability to disable comments on tracks. The Pro Unlimited tier allows unlimited uploads.[34]

SoundCloud Go

On March 29, 2016, SoundCloud unveiled SoundCloud Go, a subscription-based music streaming service; the service integrates licensed music from major labels into the existing, musician-uploaded content of the service. Co-founder Eric Wahlforss stated that this aspect would help to differentiate SoundCloud Go from other music streaming services such as Spotify and Apple Music, as it technically provides a larger total library of songs than competing services, with a higher degree of diversity in its content. The Verge found that, excluding existing content uploaded by users, the service's initial library of songs is smaller than those of its closest competitors.[24][35]

Mobile apps

SoundCloud offers two mobile apps; the main SoundCloud app is oriented towards streaming, with music discovery, playlist, and sharing features.[36] In November 2015, a separate app known as SoundCloud Pulse was first released for Android; it is primarily oriented towards content creators, allowing users to upload and manage their uploads, reply to comments, and view statistics. Pulse's features were previously located within the main app; senior marketing manager Brendan Codey explained that the shift to separate apps was meant to allow SoundCloud to improve its user experience for content consumers, without having to worry about how these changes effect features oriented towards creators.[37]

Reception

Recognition

SoundCloud won the Schroders Innovation Award at the 2011 European Tech Tour Awards Dinner.[38][39]

Criticism

As SoundCloud has grown and expanded beyond its initial user base, consisting primarily of grassroots musicians, some original users have complained that it is losing its fidelity to artists in an attempt to appeal to the masses, perhaps in preparation for public sale. Such criticism particularly followed the launching of a revamped website in 2013 that was heavily reconfigured to be more amenable to listeners—at the expense of artists, some claimed. CEO Alexander Ljung responded that while he would take these criticisms into consideration, the changes to the site would result in higher usage numbers for SoundCloud.[40]

On 3 July 2014, TorrentFreak reported that SoundCloud offered unlimited removal powers to certain copyright holders, allowing those copyright holders to remove paid subscribers' content without avenue to contest and dispute wrongful deletions.[41]

SoundCloud has announced a new partnership with Zefr, a content tracking company that currently works with YouTube to help identify songs on the platform and better facilitate either takedowns or ads being run against it. This means Zefr is Soundcloud's copyright enforcement manager. The announcement is light on the hard details of what the two companies plan to do together, though Zefr states it will "better understand the sharing of content on the platform." Some users are worried it could mean a stricter copyright enforcement and more ads.[42]

SoundCloud has a continuous play feature on non-mobile systems which relates to the listener's stream and likes. Unlike YouTube's autoplay feature which is on by default but can be turned off, users cannot turn off the continuous play feature on SoundCloud.[43]

Blocking

The Government of Turkey blocked access to the SoundCloud website on 24 January 2014.[44][45][46] A user named "haramzadeler" ("bastards" in Turkish) uploaded a total of seven secretly recorded phone calls that reveal private conversations between the Turkish Prime Minister, Recep Tayyip Erdoğan, and others, including: Erdoğan Bayraktar, local politicians, some businessmen, and the prime minister's daughter, Sümeyye Erdoğan, and son, Bilal Erdoğan.[47] Linked to the 2013 corruption scandal in Turkey, some conversations on the recordings revealed illegal activity and possible bribery—mainly about the building permit for villas located on protected cultural heritage sites in Urla, İzmir.[48] The opposition party Cumhuriyet Halk Partisi submitted a parliamentary question to TBMM (the Grand National Assembly of Turkey) concerning the issue, which asked why SoundCloud services were banned without any proper cause or reason.[49][50]

See also

References

  1. ↑ "Soundcloud.com Technology Profile".
  2. ↑ "Alexa traffic rank".
  3. 1 2 3 4 5 EVELYN M. RUSLI, HANNAH KARP, DOUGLAS MACMILLAN (9 December 2014). "SoundCloud’s Valuation Could Top $1.2 Billion With New Fundraising". The Wall Street Journal. Retrieved 11 December 2014.
  4. 1 2 3 4 5 6 Eliot Van Buskirk (6 July 2009). "SoundCloud Threatens MySpace as Music Destination for Twitter Era". Wired.
  5. 1 2 3 Mike Butcher (18 May 2010). "Now a million on SoundCloud – This startup is scaling globally". TechCrunch.
  6. ↑ David Noël (23 January 2012). "SoundCloud Hits Ten Million Users". SoundCloud.
  7. 1 2 Drew Olanoff (9 May 2012). "SoundCloud announces "Next" version of its site, hits 15M users". The Next Web. The Next Web, Inc. Retrieved 11 December 2014.
  8. ↑ Robin Wauters (10 December 2012). "SoundCloud user accuses SoundCloud of "doing a Zuckerberg" – on SoundCloud". The Next Web. The Next Web, Inc. Retrieved 11 December 2014.
  9. ↑ Martin Bryant (4 December 2012). "With 10 hours of audio uploaded every minute, SoundCloud rolls its new site design out to all users". The Next Web. The Next Web, Inc. Retrieved 11 December 2014.
  10. ↑ Peter Kafka (13 March 2013). "Twitter’s Music App Will Let You Watch, Too, With Help From Vevo". All Things D. Dow Jones & Company Inc. Retrieved 11 December 2014.
  11. 1 2 Peter Kafka (24 January 2014). "SoundCloud Has a New Pile of Cash, and Wants to Cut Deals With Big Music". ReCode. Revere Digital LLC. Retrieved 11 December 2014.
  12. ↑ Jefferson Graham (17 July 2013). "Who's listening to SoundCloud? 200 million". USA Today.
  13. ↑ Ellis Hamburger (24 January 2014). "SoundCloud pursuing its first licensing deals with record labels". The Verge. Vox Media, Inc. Retrieved 11 December 2014.
  14. ↑ Tom Pakinkis (28 March 2014). "SoundCloud holding licensing talks with labels - report". Music Week. Retrieved 31 March 2014.
  15. ↑ Bobby Owsinski (24 July 2014). "Major Labels Buying Into Soundcloud Sets It Up For Acquisition". Forbes. Forbes, LLC. Retrieved 11 December 2014.
  16. ↑ Nathan Ingraham (20 May 2014). "Twitter's plans to purchase SoundCloud have evaporated, claims report". The Verge. Vox Media. Retrieved 11 December 2014.
  17. ↑ "SoundCloud Debuts Monetization Play With 'On SoundCloud', Announces $100 Million In Funding". Billboard. Retrieved 29 March 2016.
  18. 1 2 3 Jill Krasny (9 December 2014). "SoundCloud May Soon Join the Billion-Dollar Startup Club". Inc. Monsueto Ventures. Retrieved 11 December 2014.
  19. ↑ "Sony pulls music from SoundCloud over money dispute". The Verge. Retrieved 29 March 2016.
  20. ↑ "Soundcloud Signs Indie Labels As It Preps Subscription Service". Variety. Retrieved 29 March 2016.
  21. ↑ "Soundcloud strikes licensing deal with Universal Music Group". The Verge. Retrieved 29 March 2016.
  22. ↑ Sarah Perez, TechCrunch. “SoundCloud confirms its deal with Sony Music, paving the way for its subscription service's launch.” March 18, 2016. March 18, 2016.
  23. ↑ "Sony Has Officially Signed On To SoundCloud". Forbes. Retrieved 2016-03-21.
  24. 1 2 "SoundCloud offers a subscription service in a late play for mainstream music fans". Los Angeles Times. Retrieved 29 March 2016.
  25. ↑ Hill, Brad (14 November 2013). "Soundcloud celebrates five years; releases impressive stats". Rain News.
  26. ↑ Woods, Ben (4 January 2014). "15 of the best music streaming platforms online today. Which one is best for you?". TheNextWeb.com.
  27. ↑ "Introducing On SoundCloud, our new creator partner program". SoundCloud Blog. Retrieved 27 September 2014.
  28. ↑ "On SoundCloud". Retrieved 27 September 2014.
  29. ↑ Graham, Jefferson (17 July 2013). "Who's listening to SoundCloud? 200 million". USA Today.
  30. ↑ "SoundCloud – Reach to Millions of Music Lovers". Soundcloud Promotion. Retrieved 22 April 2013.
  31. ↑ "Musikmesse 2010: PreSonus launches major enhancements to Studio One". MusicRadar.com. 22 March 2010. Retrieved 27 April 2010.
  32. ↑ Residit s.r.o. & David Jerabek & Jan Elias. "SoundYouNeed.com - Music search engine & player". soundyouneed.com.
  33. ↑ "Uploading requirements". SoundCloud. Retrieved 2016-03-21.
  34. ↑ "SoundCloud launches simplified, cheaper Pro plans and embraces brands with Pro Partner accounts". The Next Web. Retrieved 29 March 2016.
  35. ↑ "SoundCloud’s subscription streaming service is here (and it needs work)". The Verge. Retrieved 29 March 2016.
  36. ↑ "In Wake Of Apple Music, SoundCloud Update Focuses On Music Discovery, Better User Experience". TechCrunch. AOL. Retrieved 29 March 2016.
  37. ↑ "SoundCloud Rolls Out A Dedicated App For Creators". TechCrunch. AOL. Retrieved 29 March 2016.
  38. ↑ Rooney, Ben (3 November 2011). "Soundcloud, Wonga Win Tech Tour Awards". The Wall Street Journal.
  39. ↑ "Tech Tour".
  40. ↑ Mac, Ryan (26 April 2013). "SoundCloud Manages Criticism as it Moves to Become the YouTube of Audio". Forbes.
  41. ↑ "Universal Music Can Delete Any SoundCloud Track Without Oversight". TorrentFreak. 3 July 2014.
  42. ↑ "SoundCloud Partnering With Zefr, YouTube's Copyright Enforcement Manager". Music Times.
  43. ↑ "How do I disable that #$%#$% Autoplay". SoundCloud Community.
  44. ↑ Marc Hogan. "Has Turkey Banned SoundCloud?". Spin. Retrieved 4 February 2015. According to a report from New York-based online news startup Vocativ, earlier on January 27 a Twitter user posted links to SoundCloud audio of phone conversations by Turkish Prime Minister Recep Tayyip Erdogan, whose government has been cracking down after allegations of widespread graft.
  45. ↑ "Soundcloud.com'a erişim engellendi". Sözcü Newspaper (in Turkish). Sözcü. Retrieved 25 January 2014.
  46. ↑ Dorian Jones. "Turkey: Is a Dark Net Rising?". Eurasianet.org. Retrieved 1 February 2014.
  47. ↑ Oray Egin. "Loose Lips Threaten Turkey's Powerful". Vocativ. Archived from the original on 29 January 2014. Retrieved 30 January 2014.
  48. ↑ "Erdoğan Sacks Izmir Gov'nor for Shady Villa Deal". Aydınlık. Archived from the original on 22 December 2014. Retrieved 30 January 2014.
  49. ↑ "Soundcloud.com'u Erdoğan mı kapattı?". Sözcü Newspaper (in Turkish). Sözcü. Retrieved 25 January 2014.
  50. ↑ "Turkish main opposition questions Erdoğan about Urla villas". Today's Zaman. Retrieved 30 January 2014.

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