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Digging its own grave: Soundcloud Go

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We’ve been covering the slow and painful meltdown of Soundcloud over the last few months whenever something new comes up, but this time it seems like Soundcloud is attempting to claw back some revenue: a subscription service for listeners. The news doesn’t really come as a huge surprise, since rumours have been circulating for a while now, but it doesn’t look good.

The newly launched Soundcloud Go costs $9.99 per month or $12.99 through the iOS app and a discounted $4.99 for the first six months if you have a Soundcloud Pro account. For that, you get the promise of offline play, a bigger library of pop music, and ad-free listening. You can read the official announcement on the Soundcloud blog to drill down into the information.

MY THOUGHTS

I still use Soundcloud. Probably daily. I listen to mixes and podcasts on it, and download any I can to listen to on the go. In fact, I’m listening to it right now. I could never see myself pay for this service, on top of Spotify, Netflix, and any other online services I might need. Yes, the bottom is falling out of the web advertising industry, but the most successful paid services are those with real added value. Content on Soundcloud is rarely only found on there. A quick search for a mix I might be interested in would quickly show a copy on YouTube, Mixcloud, as well as any number of DJ mix aggregator sites.

So now that Soundcloud is trying to charge $10/$13 for a premium service once the horse has already bolted, I am seriously pessimistic. It’s simply crazy that even premium users have to pay, albeit with a weak offering of the first six months at a discount. These are people already invested in the platform. Users that have paid a lot of money over the years, and that have been the backbone of the site, creating the breadth of content that the labels are doing their utmost to remove.

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We’re going to have a lot of Taylor Swift’s catalogue,” said Wahlforss.

I think this quote says a lot about not only where Soundcloud is headed, but how they understand their core audience. Yeah, there might be more money in mainstream music, but that’s not what Soundcloud has ever fundamentally been about. Even at the height of its popularity, with mainstream listeners choosing the service, the brand identity has been about new music from electronic producers, mixes and podcasts from big and small DJs alike: a go-to place to find your place in the underground. Even at the height of the EDM craze, Soundcloud was where you went for mashups and remixes. This isn’t a pivot. This is crapping on your hard-earned branding. This is New Coke without the huge cashflow buffer.

And that’s why I think this will flop. Hard. We already have plenty of places to listen to Taylor Swift or whichever pop idol is hot right now. Or… as I do, avoid like the plague. And they all do it better than Soundcloud. The reality is that with this move, Soundcloud no longer fits in anywhere. Hearthis and Mixcloud will do podcasts and DJ mixes better (and cheaper). Spotify, Google Music, Apple Music, et al will do charts and albums better (and possibly cheaper on family accounts).

Simply put, Soundcloud is SCREWED. I kinda feel bad for them, even if they did make their own bed. And I really hope it does kill the site and teach the streaming industry what working with the majors does to you. Nobody wins, and that’s how RIAA like it. But that’s a conversation to have with Jared another time.

Addendum

Since I wrote this (but before publish), the dust settled a bit and a rather alarming ‘open letter’ was posted by Dave Wiskus, a member of New York indie-rock band Airplane Mode, breaking down their views on the situation with Soundcloud Go and creator partner programme, On Soundcloud. He discusses how artists that post content to Soundcloud do not get a penny from plays, ads or any other method unless they’re in the On Soundcloud scheme, which is invite-only with only a small number of artists. Dave makes the point that with Soundcloud Go now launched, the service is now not only profiting from the music uploaded by independent artists, they expect them to pay for the privilege via the Pro account!

YOUR THOUGHTS

What do you think of the announcement of Soundcloud Go? Would you be tempted to pay for it?

Soundcloud Go is out now in the US, costing $9.99 (or $12.99 in-app) on iOS only, With a discount down to $4.99 for six months if you have a Pro account.

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Dan Morse
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Opinionated DJWORX newsie. Loves Traktor, analogue mixers, vinyl and Android. The best Techno bedroom DJ you know.
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32 Comments

  1. As said, the only people that will get value from that are the artists that finally will be payed for these play counts. But at the same time, this is not what Soundcloud was about initially, so SC is now evolving into something else.

    What I did like with SC back in the days was it social nature, I have discovered a lot of djs/producers that I wouldn’t have found as easier than there.
    Nowadays, mashup, mixes and so on get deleted in a snap of fingers, even if they was there since years (ask me how I know…).
    This slowly turned away a lot of people that was doing content (be it legit or not) and now SC is no more my destination when I need some fresh hot unknown tracks.

    They probably won’t die, but there is a big amount of people who used to pay for pro plan that don’t do it anymore and that is a big loss. So now SC needs that streaming thing to make some cash and have a good account balance.

    Entering the streaming war and changing your target from the feeders to the listeners might be smart (more of them), but is it the right time ?

    2. Nobody really wants to be in streaming now anyway, it’s a broken system. There is no money in it, no matter what they say. There is certainly no money in it for artists.

  2. Just last Friday i was scouring SC looking for some new mixes to stick on my phone for the commute to work, i gave up in the end as it got that frustrating trying to find downloadable content. Personally i think they would be better trying to crack down on the mountain of spam messages you get from supposed ‘record companies’ wanting to be your manager after listening to some of your content (in my case a 3 year old DJ mix that wasn’t anything particularly special)

  3. so what i don’t understand is how are artists being payed? i know that go is only available in the states right now but are they given access to my tracks? and if so, and if users pay to listen to my crap (along all the music from the majour labels that have deals in place), shouldn’t I (or any other independent artist) get some of those 0,000000001 cents? and if we should, and users that are paying for the GO version are listening to our indie crap (some of which is awesome) where are our new user agreements? where is the licensing agreement? how does this work? i think SC is mostly small labels and indie artists in the hip hop and especially electronic scene so how will this work?

    2. I had one listener write me on soundcloud to ask me what additional music they’d get for subscribing to SCGo…

      I had to explain to them that “NO, independent artists do not get a single cent of your subscription fees, and do not share additional music based on your subscription… tell all your friends, tell everyone you know – SC does NOT pay independent artists – If you’re trying to support them, you need to find another way to do it.”

  4. Well, I’ve been called out, so I might as well bore everyone with what I think.

    I 100% agree with Dan. Soundcloud is screwed. They’ve been screwed for a long time. They’ve hidden from their core for so long because they need to make money. They need to make money because they took funding. And the people behind that money need them to make something that might one day resemble a profit, and that comes with a critical mass of listeners, which requires mainstream music. And to get mainstream music they need to sell their souls to the devil that is the major record labels.

    Granted, I don’t think Soundcloud was ever a place for DJs. DJs wanted it to be for them because it was a great service for what they wanted, but it was always for music creators. And when you throw in people getting paid for their music, DJ mixes and mashups always make that super complicated. I mean, the DJ didn’t produce the song, they took it and put it into another thing. Does the DJ deserve compensation for that? I don’t think they do. The artist does. But where does that money come from? Do you push ads against the DJ mix? Well, the DJ doesn’t see any of that, and that also seems strange cause they can’t control it. And what if the artist doesn’t want their track in that mix?

    But Soundcloud thinks that they can get that critical mass of listeners from having mainstream music. And since mainstream music accounts for pretty much all music sales (it’s what makes it mainstream) they figure they can pull more listeners by having it. but now they need to make deals with the devil known as the major record labels. And those companies are going to bleed Soundcloud dry, because they own the content. They own what Soundcloud needs, and Soundcloud will do anything to get it. And to a certain extent, they will even die for it, because they can’t keep this going.

    Let’s be honest, Soundcloud and Spotify have never, ever made a profit. They never will. They can’t. The Verge leaked Spotify’s contract with Sony a few years ago, and it pretty much states outright that even if Spotify makes more money, larger percentages of it go to Sony. It’s a mess.

    The only way Soundcloud can survive is to remove mainstream content. And that requires them to police themselves in ways that they are notoriously terrible at. But it’s the only way they win. It also means they grow slower, and will lose more funding and will have to shrink, even though they will need more people. So… yeah, they should have never opened this can of worms.

    They also shouldn’t let DJs put mixes on it. It just makes an already complicated situations FAR more complicated. You want podcasts? There are tons of podcast apps that you can use to subscribe to, that almost all of those podcasts are on. And they’ll download automatically to your phone. You want DJ mixes? There’s mixcloud, and eventually something else will come along that will be better. But we also need to accept that DJs walk a very fine line between legal and illegal uses of music, especially mainstream music.

    1. Wow, you really hit the nail on the head. The first step really was opening the can of worms that is taking funding. Had they not done that, they would have slowed development to keep costs low but continued to focus on maintaining a platform for independent artists and labels. Once they took a ton of funding, they had no choice but to find a path toward making a ton of money and the only path toward that, as you said, is embracing mainstream music.

      1. 100% agree. Once other people have put large amounts of money in, all they want to see is growth. And the internet is still barely understood as a business medium.

          1. Because either way it shakes out, you make a killing and most people take that as the deserved payout after living the chaotic entrepreneurial life for the prior several years.

            I love the underground electronic scene but even I would be seriously tempted to follow the same path.

              1. If someone has a deep connection to what they’ve built then it’s a different story. But in cases where the aim was always to build either a technology or a business and not necessarily a community, the money and connections you get out of a sale are enough to satisfy most people, especially because it sets you up nicely for any future ventures you’d like to pursue.

                I believe Soundcloud’s mission was never primarily to build a community, it was instead to either build a technology/platform or a business. The lines are bit blurry, but they’re definitely there.

                As a Marxist, I actually find it quite interesting looking at the the cost & benefits of entrepreneurs selling their creations and the similarities in what usually follows in most cases: layoffs, betrayal of the mission for profit, etc. The company I work for now went through this exact thing last year.

          2. Money. They can make a TON of money. It’s just that not all businesses are really well suited to public ownership. I think twitter is a great example of that. Especially considering no one really knows what they should be. And I think soundcloud has a similar issue.

                  1. I don’t give Soundcloud that much credit.

                    I think they don’t know what they really wanted to be, and hence they made decisions on some general plan that ended up working against them. They didn’t need to allow mainstream music on to their service. They didn’t need to create a garbage content ID system. They didn’t need to create a streaming service when it wasn’t needed at all, and they DEFINITELY didn’t need to roll it out before they were ready to accommodate all of their creators.

                    When they decided to allow the major labels onto their service, they made a deal with the devil, knowing it was the devil, knowing they couldn’t win. Every other decision from there was a result of that.

  5. its really hard to understand why anybody would actually like this soulless skinny industry whore of a singer named Taylor Swift. it has nothing to do with age, if i was 14 i’d still think its garbage.

    Kids should listen to rebelious music, like Punk back in the days, Taylor Swift is music that even your grandma would listen to totally oblivious of how much of a fake industry we live in now

    1. Even Youtube seems to be a better option for social, community and exposure ! I’m trying it since the beginning of the year : not as fast as SC but you get views, you get interaction and copyrights are often “soft” : you can’t monetize but you’re still online. I found this fair to be honest…

  7. I agree with this article 100%. Soundcloud Go will be a failure. Why would anyone pay for it over one of the established streaming services?

    At the end of their last full financial year they posted a loss of $44M. They spend $20M a year on wages. They may still be getting healthy levels of investment to keep them afloat, but that investment is based on the premise that services like Go will be a success. It’s just another late to the party, inferior also-ran that will be operating on wafer thin margins due to the level of control that the major labels have. Spofity have over 30 million paying customers. They brought in over three quarters of a billion dollars in revenue in their last financial year and still posted a $167M loss.

  8. Soundcloud GO is a joke. A last ditch effort by innovative people who are showing they’re no longer innovative since they got in bed with BIG Brother. Soundcloud otherwise has not changed and the worst part about this Soundcloud GO is that it even further alienates the indie music industry. They continue to search and destroy by taking down peoples mixes, remixes, and edits and in a lot of cases even if they aren’t breaking any copyrights lol. Soundcloud at this point you’re very close to GO-ing the way of the Do Do Bird.

  9. Streaming platforms have been subject to one lawsuit after another. I have little confidence in their longterm stability.

    Not only that — I strongly believe that if you play out and make money from DJing, then you should pay for every track you play, and not accept streaming revenue as enough. And lets not even go into whether live performance of streamed tracks is legal or not.

    Streaming needs to die so that it can be reborn in a way that everyone can win. Because the people making the music are getting shafted while everyone else prospers.

  11. I’ve been posting similar thoughts on several electronic music sites… to the sound of crickets at best, and ‘no bro, it will be all good’ at the worst…

    from the perspective of someone with hundreds of SC uploads, I find their marketing and business angles over the last four+ years to be very depressing. They’ve continued to press towards a consumer-centric business/design model, while abandoning useful creator tool development and flat-out ignoring the common-sense requests of it’s creators.

    At the same time, there isn’t really a great alternative for privately sharing original songs, complete with waveform commenting and download options… Caught between an expensive-rock and a non-existent hard-place.

    Every fall since around 2011, I’ve struggled with the decision to renew my Pro account. Every year, reflecting on SC’s past 12 months is more and more dire… It seems unlikely that I’ll renew my acct this fall :/