|Type of business||Private|
Type of site
|Music streaming, Internet community|
|Key people||Alexander Ljung (Founder & Chairman)
Eric Wahlforss (Founder & CPO),
Kerry Trainor (CEO),
David Noël (VP Community & Evangelist)
Artem Fishman (CTO)
|Alexa rank||113 (As of December 2017[update])|
|Registration||Required to post and upload content|
|Users||40 million registered users (July 2013), 175 million unique monthly listeners (Dec. 2014)|
|Written in||Ruby, Scala|
SoundCloud was established in Berlin in August 2007 by Swedish sound designer Alexander Ljung and Swedish artist Eric Wahlforss, and the web site was launched in late 2008. It was originally intended to allow musicians to collaborate by facilitating the sharing and discussion of recordings, but later transformed into a publishing tool for music distribution. According to Wired magazine, soon after its inception, SoundCloud began to challenge the dominance of Myspace as a platform for musicians to distribute their music.
In April 2009, SoundCloud received €2.5 million Series A funding from Doughty Hanson Technology Ventures. In May 2010, SoundCloud announced it had one million users. In January 2011, it was reported that SoundCloud had raised US$10 million Series B funding from Union Square Ventures and Index Ventures. On 15 June 2011, SoundCloud reported five million registered users and investments from Ashton Kutcher and Guy Oseary's A-Grade Fund, and on January 23, 2012, it reported 10 million registered users. In May 2012, it was announced that SoundCloud had 15 million users, and site usage was increasing by 1.5 million users per month.
A new API was released in December 2012 which improved mobile device support and added features such as concurrent listening and site navigation, and the ability to create personal collections. The response from users was mixed, and many expressed dissatisfaction with the change. At this time, SoundCloud was reported to be "reaching 180 million people per month", with 10 hours of content being uploaded per minute.
In March 2013, Twitter announced it would partner with SoundCloud in developing its first integrated music app. However, the project never moved forward because SoundCloud was unable to accommodate licensed music due to a lack of necessary arrangements with music labels. In July 2013, SoundCloud had 40 million registered users and listens were growing at a rate of 20 million per month.
SoundCloud announced in January 2014 that it had commenced licensing negotiations with major music companies to address the matter of unauthorised, copyrighted material regularly appearing on the platform.[not in citation given] The announcement followed a round of funding in which US$60 million was raised, resulting in a $700 million valuation. According to media sources, the negotiations were initiated in an attempt to avoid similar problems faced by Google, which had been forced to handle a large number of takedown notices on its YouTube video-sharing platform.
In May 2014, it was reported that Twitter was considering the acquisition of SoundCloud for approximately US$2 billion. However, the prospect of acquisition was discounted by the media, with one report stating that "the numbers didn't add up", and Bobby Owsinski hypothesizing on the Forbes website in July that SoundCloud's ongoing inability to secure deals with the major music labels was the foremost culprit.
In July 2017, SoundCloud announced that it would close its San Francisco and London offices and lay off 173 out of 420 employees in an effort to become profitable, with the remaining staff operating out of offices in Berlin and New York.
Monetization, subscription services
In August 2014, SoundCloud announced a new program known as "On SoundCloud", which would allow "premier" partners to monetize their content through pre-roll audio ads, channel sponsorships, 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, and that it was in "active and ongoing, advanced discussion[s]" with major record labels.
In December 2014, it was reported that SoundCloud could potentially raise approximately US$150 million in new financing, resulting in a valuation surpassing one billion dollars. The major label issue became prominent again when the new financing information was released, as the lack of monetization 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. By December 2014, SoundCloud had shared ad revenue with about 60 other Premier Partners. Concerns over the amount of revenue from the program led Sony Music Entertainment to pull its content from the service entirely in May 2015. 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.
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.
On 29 March 2016, SoundCloud launched its subscription music streaming service, SoundCloud Go. In February 2017, SoundCloud launched a mid-range subscription tier named SoundCloud Go, that allows users to remove ads and listen offline for $5 per month. The original version, which was renamed SoundCloud Go+, allows access to over 150 million songs, offline playback, no ads, no previews, and premium music tracks for $10 per month.
Among SoundCloud's key features is the ability to access uploaded files via unique URLs, thus allowing sound files to be embedded in Twitter and Facebook posts (note: as of 12 August 2015, mobile devices require a SoundCloud app to play a track within Facebook, an issue confirmed by SoundCloud in November 2016). A file may be embedded by clicking a share button corresponding to the target site (e.g., Twitter). This contrasts with MySpace, which does not have reshare buttons.
SoundCloud depicts audio tracks graphically as waveforms and allows users to post "timed comments" on specific parts of any track. These comments are displayed while the associated audio segment is played.
SoundCloud's API allows other applications or smartphones to upload music and sound files, or download files if the user has permission to do so. This API has been integrated into several applications, including GarageBand, Logic Pro, and PreSonus Studio One DAW.
SoundCloud offers premium services for musicians under the banner SoundCloud Pro. The SoundCloud Pro service allows users to upload up to six 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.
On 29 March 2016, SoundCloud unveiled SoundCloud Go, a subscription-based music streaming service; the service provides an ad-free experience, offline playback, and integrates licensed music from major labels into the existing, user-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.
The service was initially priced at US$10 per-month. On 28 February 2017, SoundCloud re-named its main Go plan SoundCloud Go+, and added a secondary tier titled SoundCloud Go at a US$5 price point, which does not include the licensed music library, but still offers ad-free and offline playback.
SoundCloud offers two mobile apps; the main SoundCloud app is oriented towards streaming, with music discovery, playlist, and sharing features. 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 affect features oriented towards creators.
By the end of 2016, SoundCloud's Android app had over 100 million downloads.
As SoundCloud evolved and expanded beyond its initial user base, consisting primarily of grassroots musicians, many users complained that it had sacrificed its usefulness to independent 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 which, according to former CEO Alexander Ljung, was implemented for the purpose of increasing SoundCloud usage.
On 3 July 2014, TorrentFreak reported that SoundCloud offered unlimited removal powers to certain copyright holders, allowing those copyright holders to unilaterally remove paid subscribers' content without recourse.
In April 2015, SoundCloud announced a new partnership with Zefr, a content tracking company that works with YouTube to help identify songs on the platform and facilitate either takedowns or ads being run against it. 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.
In July 2016, SoundCloud notified registered users via email that it would be "phasing out" groups because they "were not a strong driver to help users share their new tracks to the most users effectively". This announcement was met with alarm and concerned responses from numerous artists, who deemed the change unacceptable because it would eliminate their only effective means of sharing music on SoundCloud.
SoundCloud has a continuous play feature on non-mobile platforms 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.
SoundCloud has also been criticized for changes in service. The new update of the website and application made the feed and interface more difficult to use for some users. Also, the anti-piracy algorithm — which was put into place to combat the staggering number of illegal music downloads — has often been criticized for taking down music that was not illegally submitted or downloaded. Also, Universal Music Group has the right to take down any files on SoundCloud. Uploads can be taken down directly by Universal Music Group outside of SoundCloud's anti-piracy policy. Other than uploads, Universal Music Group has the ability to take down accounts, both premium and free. Customers of the company have claimed this to be "bogus," arguing that the right to manage and delete accounts should be reserved to SoundCloud itself, not to an outside company.
The government of Turkey blocked access to the SoundCloud website on 24 January 2014. A user named "haramzadeler" ("bastards" in Turkish) uploaded a total of seven secretly recorded phone calls that reveal private conversations between the Former Turkish Prime Minister Now President of Turkey, Recep Tayyip Erdoğan, and others, including: Erdoğan Bayraktar, local politicians, some businessmen, and the prime minister's daughter, Sümeyye Erdoğan, and son, Bilal Erdoğan. 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. 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.
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