SoundCloud's subscription launch in Ireland and UK
Music streaming company to sell adverts on free version
SoundCloud said the subscription and advertising income would give musicians and other producers of content “the opportunity to be paid for the work that they share”. Photograph: SoundCloud
The Berlin-headquartered company, which has 175 million monthly listeners, is also introducing advertising to its existing free version in Ireland and the UK, as it bids to make money from the typically unprofitable music streaming business.
SoundCloud Go will be priced at €9.99 a month in Ireland and will carry music and features, such as the ability to listen offline, that are not available on the free app. It debuted last month in the United States, where SoundCloud has been selling ads for almost two years.
The launch of the subscription service in the UK and Ireland follows a series of agreements with the music industry on how it makes payments to artists. SoundCloud said the subscription and advertising income would give musicians and other producers of content “the opportunity to be paid for the work that they share”.
“If it’s your work, you get to determine where it lives,” said Sonia Flynn, SoundCloud’s international vice-president.
When singer Taylor Swift pulled her music from Spotify in 2014, she cited the inability to restrict her work to Spotify Premium, its paid-for version, and noted that this type of control was possible with other streaming services.
SoundCloud’s 175 million monthly active users exceeds Spotify’s base of about 100 million. However, Spotify had more than €1 billion in annual revenue in 2014 compared with SoundCloud’s income of €15 million. Both are loss-making, while other companies in the music streaming business, such as Pandora and Deezer, are also struggling.
The launch of a subscription product and push for advertising income in the UK and Ireland is part of SoundCloud’s strategy to climb out of the red.
Revenue streams on the ad-supported version will include audio ads, promoted tracks and “creator partnerships”, where SoundCloud negotiates link-ups between brands and artists as they release new material.
“In Ireland and the UK, there is a vibrant creator community. Ireland and music – those two things go really well together.”
Some 12 million content creators are heard on SoundCloud each month, according to the firm, while its catalogue has been “significantly expanded” to more than 125 million tracks.
“Creators are, and always have been, at the core of everything we do,” said Mr Ljung, SoundCloud’s chief executive. “It’s through this monetisation of the platform . . . that we will eventually enable them all to be paid for the work they share with the world.”