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Amid worrying reports that SoundCloud may well and truly be over the hill, it’s been easy for the music community to get carried away preparing obituaries for the stream titan that cite a lack of management expertise, flawed revenue model, and ill-treatment of fresh talent as root causes of an untimely demise.
However, to call SoundCloud ‘dead’ would be incorrect, especially in light of recent statements from the company and some of its more high profile supporters.
The fact is that, even in the most trying of times, SoundCloud has more visitors to its website per month than its main competitors, even while the number of registered users and time spent on the website per user has continued steadily dropping in favor of major competitors like Spotify and Apple Music.
It would be naïve to suggest that SoundCloud’s problems could miraculously vanish with a major cash injection that many anticipate is coming the website’s way.
For starters, the entirety of the company’s revenue model needs a stark restructure if any lasting improvement is to be observed.
A key contributing factor to SoundCloud’s current struggles is their despotic removal of mixes and singles due to ownership and copyright issues. Though there are surely two sides to this not insignificant issue, SoundCloud’s “three strikes” rule has adversely affected budding musicians and eminent producers alike—Martin Garrix’s music was taken down by the site at the beginning of the year.
By relaxing the rules surrounding the removal of mixes—at least those in which the mixer credits each track to the contributing artist—and bootleg remixes, SoundCloud just might be able to live up to their vision of being a “unique ecosystem where all forms of expression can live and thrive.” They could possibly even resurrect their faltering finances in the process.
Currently, the website’s independent artist base—which had been their main source of revenue until the introduction of their new subscription pricing option a few months ago—has been steadily shrinking while they continue to pay exorbitant rates to major music labels to keep them from abandoning a sinking ship. It’s just a matter of time before the such a system would implode as company strategy continues to turn its back on its core user base
The possibility of this scenario, however unlikely, should be taken as a serious concern. After all, enterprise owners have pulled the plug on more useful money pits before, which begs the question: ‘What kind of post apocalyptic musical society could emerge once SoundCloud is gone?’
Well, for starters, such events would throw a serious wrench in the A&R efforts for some 20,000 independent labels that currently populate the website. This process of recruiting up and coming talent is essential for the all-round development of those musicians and, in turn, benefits major labels who bank on their indie counterparts to sift through a sea of prospective signees and filter out those with true talent.
Artists like Kygo, Seven Lions, Illenium, Martin Garrix and Mura Masa would not have become household names without the unprecedented, direct-to-consumer exposure that SoundCloud provides, to say nothing of their equivalents in the hip hop community. Other streaming sites simply lack the social and share-friendly elements that allow for artist discovery on the platform. If artists depended solely on, say, Spotify playlist placement as a possible break, indie development in the electronic music industry would seriously stagnate or even regress with time.
Let’s be honest, the discovery of new artists is the main reason the SoundCloud party hasn’t ended already.
Among an ever shortening list of edges the company holds over other services is its user interface which is more than half social media. No other website offers the combination of an instant feed, the ability to like and repost music to one’s own profile, or enables feedback on an artist’s work. On this front, the site’s only real competitor is YouTube—but mobile streaming videos can be cumbersome and data intensive, especially for mobile users.
Meanwhile, Spotify, Apple Music, and Pandora don’t even come close to reproducing anything near SoundCloud’s community-oriented interface. They are music streaming websites, and that’s all.
They offer no value addition to the streaming process whatsoever, apart from a smattering of user-specific playlists, metric insights and simple notifications for followers when new music is released.
In fact, these websites are more suited to housing a user’s private collection and offering recommendations based on a taste profile, while SoundCloud basically shoves new music in users faces around the clock. While this distinction may not be of much importance to a casual listener, it makes a difference to tastemakers, label heads, and for music writers like myself. Perhaps I’m alone in feeling that I would much rather open a web page and have new music from various sources waiting patiently for my discerning ear, than scour social media for new music announcements, opening them one at a time across various tabs and servers.
Which brings us back to SoundCloud’s defining characteristic—a literally unfathomable degree of accessibility.
Though many readers of Dancing Astronaut live in the United States, many human beings who consume electronic music do not. As of publication, SoundCloud can be freely accessed by citizens of 190 countries, boasting over 175 million monthly hits.
Spotify’s anemic outreach has brought the app to a measly 60 countries with an Alexa rank of 147 to SoundCloud’s 109. While Apple Music claims to be available in 120 countries, many of those regions only have access to certain features of the service. Countries like Qatar are only able to subscribe to iTunes Match—a service that depends on your ownership of the music, to begin with.
Both fall well short of SoundCloud’s global appeal inherently with their pay-to-play subscriber models that require monthly memberships and, often, the use of a native app.
As an Indian citizen, the biggest stumbling block to Spotify’s potential reign of supremacy is its lack of global support. Somehow, this region is dramatically neglected though India constitutes over 1/7th of the world’s population and is considered by many to be the next big destination for EDM. There is a reason that eminent producers like Hardwell, Armin van Buuren, and Tiesto visit India on a regular basis, and reserve high praise for the energetic, high-capacity crowds that turn up to their shows.
To be honest, it’s been completely baffling to see the lack of action taken by Spotify and other stream competitors to explore the vast, untapped potential the Indian market has to offer. The role I currently hold at Dancing Astronaut was predicated on opinions about music formed solely on SoundCloud. For years the site has been my bread and butter, as much a part of my daily routine as brushing my teeth. I sure as hell am not ready to let it fade into irrelevance unless a fitting heir is poised to replace it.
SoundCloud will continue to hold an ace up its sleeve, to my mind, as long as it continues to dominate the international market and toast its competitors with website traffic. The weight of those metrics alone could empower the site to play hardball with major labels over subscription fees to gain a financial upper hand. If the labels disagree and SoundCloud does go bust, 175 million users from 190 countries could potentially be without access to music.
Labels, artists, and users would lose too much. It’s in our common interest to ensure SoundCloud remains up and running for the foreseeable future.
One can only hope that such a bleak future would never come to fruition, as the solution to this seemingly complex financial problem simply requires SoundCloud to become the website it was always supposed to be—a music sharing community for musicians, by musicians.
SoundCloud is so much more than just a music streaming website, it’s a blissful, nearly flawless aggregation of different levels of the musical supply chain with the power to modify trends and shape genres. With any luck—and quite a bit of work—it could even remain so for decades to come.
Kanvar Kohli is Dancing Astronaut’s International Editor. Based in India, he provides a fresh, cogent perspective on the electronic music industry from one of its biggest emerging markets.