Article states that users generating content aren't interested in money. Wrong. Users have to sell through bandcamp because for some reason, SC hasn't provided a market place.
Article states how artists like Skrillex made a name for themselves but posting remixes of famous songs on SC. SC now removed remixes, citing copyright infringement, even on legal, commissioned remixes. SC flags your song if the title contains a famous artist's name or song title even if your song didn't actually sample the famous song. After 3 strikes, your account is banned, all fans and followers lost.
Smart artists are leaving SC in droves.
SC is hosting music from major labels. Users pay nothing to listen. How are they making money? The only users that pay are the artists uploading their own work. Yet those artists have no way to make money on SC. SC has sponsored tracks inserted into listeners feed. That doesn't pay the bills. Also, the promoted track is not based on the user's taste so they mostly hear songs they hate.
Exactly. Between solid tech and a massive userbase, Soundcloud once had the monumental opportunity suggested in the article. But they have played their cards quite poorly which means this article is ridiculous.
I've been on Soundcloud for a looong time and unlike Spotify , it never was a radio but some paid cloud hosting for mp3 with social features. So sound cloud relied on paid customers who uploaded their music on the platform for promotion purposes. I don't think they ever had any opportunity to turn into a Spotify competitor. That's not how people use Soundcloud.
I think however Beatport is trying to be the Spotify for IDM. not sure how it is working for them.
Beatport was "the shit" back then and made a LOT of money. The problem with Beatport is that it works as long as djs are compelled to renew their catalogue.
it became big thanks to "Electro", then Minimal techno , then it made Deadmau5 big, after Deadmau5 nothing really happened in the IDM world, so Beatport success kinda went down.
Neither Dubstep nor HipHop ever were best selling genres on Beatport. And today, MP3 sells don't bring much revenue even for big names. I'd be surprised if TOP 10 beatport artists sell more than a 1000 units per best selling track today.
what does IDM stand for? The genres and artists you've mentioned are what I consider fads or the mainstream trends of electronic music for the past ~15ish years.
There is plenty of interesting things going on in electronic music, depending on your tastes. Trap sort of replaced dubstep as far as accessible popular and mainstream EDM. Deep house seems to be popular these days. Drum n bass is having a weird spate of popularity and soul-searching at the same time. Future bass seems to be a defined genre now.
*none of this post is offered in arrogance, merely stating my honest opinions which are devoid of value judgements.
D'n'B is kinda dead except for the UK scene which has always existed.
First time I hear about Future Base , I checked some stuff and but to me it's just trap/dubstep again.
While you mentioned "fads" ,well that's what drive the business. Right now there is no real enthusiasm toward something fresh and new, aside from a few live acts but they don't qualify as EDM in my book.
Are yoi talking about IDM (a specific leftfield genre, popular in mid-00s, but never mainstream?), EDM (which grew to mean a mixture of electrohouse, brostep and trap) or electronic dance music in general?
Also, are you talking about Beatport or Beatport Pro? They are very different services, targeted at different audiences.
Assuming you're talking about Pro, I doubt it's success depends on currently popular genres. It's targeted specifically for DJs, and sells not only mp3s, but uncompressed wavs, and more innovative formats like NIs remix decks and stems, which are only relevant to DJs. Who will always "compelled to renew their catalogue", of course. And most often, the only choice other than Beatport and Juno is to hunt down the vinyl on Discogs: most of releases never make it to torrent trackers, and are pressed in very small amounts, in low hundreds. And even more releases from small labels are digital-only. So, unless you want to play the same music as everyobody else, you have no other option than to pay.
Agreed, Very Wrong. I've been on SC for 4 years now, and never seen a dime. The original article is a fluff piece, fluffing up the "free exposure/audience building" falsehood.
User generated content in the music business has been tried over and over again. MP3.com, MySpace, Garageband, and many others. The problem is that the consumer wants the hits, the names, the current hot artists. They don't want the long tail of unknown artists.
Sure there are those who like to check out the new stuff and occasionally something pops.
Soundcloud will eventually end up paying the same royalty rates as Spotify, Pandora, Rhapsody, Slacker, and all the rest thus eliminating this "SoundCloud has much better unit economics than Spotify."
What is to stop Spotify from adding an artist upload feature?
The macroeconomic factors on why all of the music delivery services are eventually going to fall in value has to do with Apple, Google, Microsoft, and Amazon treating music as a valueless commodity.
No one can charge more than iTunes for a song or streaming service. Apple sets the market price and operates their business at low margins due to ancillary revenue from hardware. If you're a music service and have no ancillary revenue to increase overall margins, you've got a classic business problem. The comparison to Youtube is also flawed because it doesn't mention that AdSense is the ancillary revenue that has kept YouTube afloat these many years.
Furthermore, the content owners (copyright holders) will continue to raise prices and cut exclusive deals with different providers in order to maintain their cut of the pie. You see this with the content patchwork across Netflix, Hulu, Amazon Prime, and even Youtube Red. No player has all the licenses all the time.
Music is a wonderful thing, but delivery is a commodity service where the players are competing on style and features. Content is ephemeral and a marketing illusion for the most part. If you want people to come, you have to have the stars.
Totally agree that delivery is a commodity. However, as a user, I ditched all services in favor of Soundcloud because of the discovery part. For example, Diplo and Tiesto post and repost almost weekly, combined with the rest of people I follow you get a stream of the very latest music of your taste, manually curated (reposted) by the top DJ's themselves. It's not just an "upload feature", its like Facebook for music: you hit play and get a tailored endless stream of awesomeness, 0 effort on your part. No need to hunt for and buy tracks one by one. No need to suffer through some unknown Pandora voodoo that turns up the same tracks of unknown recency, over and over. Just follow the people you like, and it will play the latest music you like, simple as that.
I don't know if Soundcloud can manage to build a viable business, sometimes they make changes that piss off users and uploaders, and the current model doesn't look too lucrative. But for me as a user, the experience is night and day compared to the true commodity services (iTunes, Amazon, Google, Pandora, Spotify, etc etc), who I think will soon start to crack under margin pressure like Rdio, Mog and others.
I agree that Soundcloud is a great place to find unknown artists and new music, just as MP3.com was 16 years ago. Perhaps it can be larger than Spotify in terms of users and VC money that it can attract. None of these services will be valuable businesses as their revenue model is fundamentally flawed and the competition runs essentially the same business on much lower margins.
The largest music streaming site on the web is Youtube and it charges nothing for the service, nor generally admits, that it holds this distinction. The consumer will pay, but very little, when there is a free alternative.
I feel like you're overly being dramatic about "ditching all services". Do you literally only listen to music through soundcloud? If that is indeed the case, you're missing out on a lot of great music. Also as a listener of both Soundcloud and Spotify, I think Spotify's discovery has improved immensely to the point where it's much better than the filter bubble of a feed you create on soundcloud
I use soundbutt for at least 90% of music I listen to. I use spotify never. The fact is everyone is missing out on a lot of great music because there is more great music than any one person can listen to.
On the indie side, delivery is worth actual money because their alternatives are to build their own e-commerce site (never goes well for nontechnical folks -- pay a bunch for a consultant to set up a site that never gets touched again, suffers bit rot, and probably falls over if you ever actually catch a big break) or go to iTunes and be a tiny undifferentiated speck in a sea of music, while paying 30% for the privilege. According to a couple reports I have seen, bandcamp is actually profitable. Maybe they won't be crushing the majors any time soon, but they seem to be proving there is a viable market for what small musicians do.
> User generated content in the music business has been tried over and over again. MP3.com, MySpace, Garageband, and many others. The problem is that the consumer wants the hits, the names, the current hot artists. They don't want the long tail of unknown artists.
I think Soundcloud has a very different audience. In my opinion hardly anyone cares about the hits over there. And it isn't a requirement to feature the hits in order to be successful. Ask Bandcamp, they are doing quite well with their endless niche catalog.
Personally, I consider myself a mostly digital crate digger who loves to explore obscure music and forgotten gems. Soundcloud is really helpful when trying to keep up with some of my favorite labels - an institution Spotify & Co. couldn't care less for. Soundcloud surely doesn't have everything but at least it fills some of the huge gaps, that Spotify, Apple or Google aren't interested in at all.
Based on SoundCloud's Android app I would say this is unlikely. The information density has dropped to JUST fitting in 2 songs per screen on my phone!
This makes it almost unusable for discovery on mobile, since I have to scroll... and scroll... and scroll... while trying to glance at track names in between flashy pictures. And the runtime in the stream disappeared quite a while ago for no reason I can think of.
Ripping off Facebook really doesn't work for a music app. Spotify at least has something pretty usable (though that too has gotten worse).
My experience has been that this is less of an issue with their UX and more of an issue with the stream itself. Once you start following a lot of artist and especially if you download tracks through the download gates, you end up with a lot of noise in your stream. I'm a DJ and I recently had my 3 year old Soundcloud account with lots of my published music and mixes removed because I had some copyright content in a mix. It was a major bummer but having a new account with a fresh stream without as much junk was a silver lining.
Same for iOS. Managing your own songs, e.g. building Albums/Playlists is also a challenge, there are just too many screens/modals with slightly different options. Also an important missing thing in the app is an offline-mode.
I really like the idea of SoundCloud and still use it regulary, but they really need to enhance their UX in all clients.
No it wont. The last year or so of policy updates has pretty seriously alienated a lot of the original user base, who have since started using Bandcamp and other outlets a lot more seriously. Move involvement from major labels just means that copyright enforcement will keep getting increasingly strict, and the content creators will keep moving to Bandcamp.
If hope that SoundCloud can survive the transition from a brilliant service with innovative features (especially the user-annotated waveforms), to a "competitor" to the likes of Spotify or Pandora.
I fear that the VC/investor zeal for monetizing the hell out of SoundCloud will ruin what has made SoundCloud so special, and that sure, it may some day be worth more than Spotify, but if so I suspect it'll devolve into something less than its present goodness, and an inevitable drop in valuation will follow, leaving VCs scratching their heads.
So it goes with every good online music service. They come, they go. Investors cash out, users get screwed, same as it ever was.
Unfortunately, Soundcloud doesn't seem to have the technical staff to keep up – the new app remains a disappointment after months of adding-back features and streaming remains shoddy at best, with random interruptions that require manual intervention.
I hope that in the coming months they catch up to Spotify's performance.
I had only been using Soundcloud for around a month or two when they decided to push out the new version of their app so I had relatively little attachment to the old version, but even then it was blatantly obvious to me that they had butchered functionality in pursuit of a pretty UI.
There are plenty of examples to pick from, but the one change I never understood was the comment system. Timestamped user comments set directly on the waveform of the song was the one truly unique feature they had and they stripped it out completely. Months passed before it was even possible to view or create comments from the app, and even now they're locked away behind an obscure menu and only display in a useless list, entirely removed from their original context.
They've tried to backpedal slightly by bolting on some of the missing features, but the new app was clearly not designed with them in mind in the first place. I would be honestly surprised if they manage to catch up.
Blatant Show HN plug: https://octave.is is a paid version of SoundCloud without the ads, Youtube-esque comments, and other garbage that clutters up individual artists' pages. Consider it the Vimeo to SC's Youtube.
This articles has some basic misunderstandings about what artists and DJs use Soundcloud for, and how money is made in the underground music world.
Consumers buy tickets to a DJ's show, DJ pays indie label, label pays artist. So three things should be clear: first, DJs aren't on Soundcloud to get signed to a major label, they are trying to drive ticket sales; second, unknown DJs don't use Soundcloud to promote themselves because ticket buyers must be local.
Finally, amateur artists don't care about developing a following like YouTube stars because their music is sold to DJs, not to listeners. Part of the appeal of a DJ is that you hear great tracks at their events that you never heard before, so they aren't going to want to buy viral Soundcloud hits that the audience has already heard.
In short, the mainstream music economy is driven by MP3 sales/streams directly to listeners. The underground music economy is mostly about event ticket sales, and Soundcloud is valuable to artists if it can drive ticket sales. That's why its current monetization strategy is mostly about telling artists which cities their fans are in. Frankly, if I were Soundcloud, my next step would be to build a ticketing platform.
I see quite a lot of friends of friends and other unknown artists promoting their work on Soundcloud, using it as somewhere to host the music. I don't use Soundcloud a lot, but I got the impression that was one of its main uses.
Perfect explanation. Soundcloud may be a valuable tool for a certain niche of (semi)professional users, but extrapolating that to Spotify (or YouTube) mass market appeal is wishful thinking at best, destructive to the existing user base at worst.
I am not active on either platform. My guess is that both platforms have something missing.
When I am shopping for music, which is what Spotify is supposedly for, then I think it is not enough to supply the music in digital form. The physical form that is independent of any current DRM annoiance and/or online website service is missing. For the music industry though, Spotify seems to be a pretty good model, where they can sell their stuff.
Soundcloud seemingly is a place to get recommendations on artists that I might like or a place to listen to music from independent artists. While there seems to be a lot music on Soundcloud, it may be a little too much. You might get lost in the noise and the community and algorithmic recommendation filters might not be enough. For the ones actually creating original music, Soundcloud seems to be a "free beer" approach. People get to listen to your music, but all you get in return is limited publicity. That might not be an enduring model for music creators, just during their initial phase of getting known.
My problem with Soundcloud is that they don't seem to be shipping anything. The website's discovery features don't update more than once a month, the page often cripples the latest version of Chrome by going to 100% CPU and overall it's just not a great experience. The company's mobile app is even worse -- it's often confusing to use, and feels like a design exercise rather than something useful.
I would love to see an official Soundcloud app, so I can use it on my desktop 24x7, but it doesn't seem like that's happening either. I just don't understand what they're actually up to, other than being the place the random average person will plop their latest track.
42 comments
[ 3.9 ms ] story [ 77.9 ms ] threadArticle states how artists like Skrillex made a name for themselves but posting remixes of famous songs on SC. SC now removed remixes, citing copyright infringement, even on legal, commissioned remixes. SC flags your song if the title contains a famous artist's name or song title even if your song didn't actually sample the famous song. After 3 strikes, your account is banned, all fans and followers lost.
Smart artists are leaving SC in droves.
SC is hosting music from major labels. Users pay nothing to listen. How are they making money? The only users that pay are the artists uploading their own work. Yet those artists have no way to make money on SC. SC has sponsored tracks inserted into listeners feed. That doesn't pay the bills. Also, the promoted track is not based on the user's taste so they mostly hear songs they hate.
I think however Beatport is trying to be the Spotify for IDM. not sure how it is working for them.
Beatport was "the shit" back then and made a LOT of money. The problem with Beatport is that it works as long as djs are compelled to renew their catalogue.
it became big thanks to "Electro", then Minimal techno , then it made Deadmau5 big, after Deadmau5 nothing really happened in the IDM world, so Beatport success kinda went down.
Neither Dubstep nor HipHop ever were best selling genres on Beatport. And today, MP3 sells don't bring much revenue even for big names. I'd be surprised if TOP 10 beatport artists sell more than a 1000 units per best selling track today.
It used to be different.
There is plenty of interesting things going on in electronic music, depending on your tastes. Trap sort of replaced dubstep as far as accessible popular and mainstream EDM. Deep house seems to be popular these days. Drum n bass is having a weird spate of popularity and soul-searching at the same time. Future bass seems to be a defined genre now.
*none of this post is offered in arrogance, merely stating my honest opinions which are devoid of value judgements.
Sorry I meant EDM.
D'n'B is kinda dead except for the UK scene which has always existed.
First time I hear about Future Base , I checked some stuff and but to me it's just trap/dubstep again.
While you mentioned "fads" ,well that's what drive the business. Right now there is no real enthusiasm toward something fresh and new, aside from a few live acts but they don't qualify as EDM in my book.
https://en.wikipedia.org/wiki/Intelligent_dance_music
lame term i think, but it exists!
https://en.wikipedia.org/wiki/Electronic_body_music
Also, are you talking about Beatport or Beatport Pro? They are very different services, targeted at different audiences.
Assuming you're talking about Pro, I doubt it's success depends on currently popular genres. It's targeted specifically for DJs, and sells not only mp3s, but uncompressed wavs, and more innovative formats like NIs remix decks and stems, which are only relevant to DJs. Who will always "compelled to renew their catalogue", of course. And most often, the only choice other than Beatport and Juno is to hunt down the vinyl on Discogs: most of releases never make it to torrent trackers, and are pressed in very small amounts, in low hundreds. And even more releases from small labels are digital-only. So, unless you want to play the same music as everyobody else, you have no other option than to pay.
This is the exact opposite of what I use Soundcloud for, but presumably they have numbers that disagree with my use...
Sure there are those who like to check out the new stuff and occasionally something pops.
Soundcloud will eventually end up paying the same royalty rates as Spotify, Pandora, Rhapsody, Slacker, and all the rest thus eliminating this "SoundCloud has much better unit economics than Spotify."
What is to stop Spotify from adding an artist upload feature?
The macroeconomic factors on why all of the music delivery services are eventually going to fall in value has to do with Apple, Google, Microsoft, and Amazon treating music as a valueless commodity.
No one can charge more than iTunes for a song or streaming service. Apple sets the market price and operates their business at low margins due to ancillary revenue from hardware. If you're a music service and have no ancillary revenue to increase overall margins, you've got a classic business problem. The comparison to Youtube is also flawed because it doesn't mention that AdSense is the ancillary revenue that has kept YouTube afloat these many years.
Furthermore, the content owners (copyright holders) will continue to raise prices and cut exclusive deals with different providers in order to maintain their cut of the pie. You see this with the content patchwork across Netflix, Hulu, Amazon Prime, and even Youtube Red. No player has all the licenses all the time.
Music is a wonderful thing, but delivery is a commodity service where the players are competing on style and features. Content is ephemeral and a marketing illusion for the most part. If you want people to come, you have to have the stars.
I don't know if Soundcloud can manage to build a viable business, sometimes they make changes that piss off users and uploaders, and the current model doesn't look too lucrative. But for me as a user, the experience is night and day compared to the true commodity services (iTunes, Amazon, Google, Pandora, Spotify, etc etc), who I think will soon start to crack under margin pressure like Rdio, Mog and others.
The largest music streaming site on the web is Youtube and it charges nothing for the service, nor generally admits, that it holds this distinction. The consumer will pay, but very little, when there is a free alternative.
Well, to be fair it is quite easy to upload tracks to Spotify. You just have to use tools like Ditto Music (https://www.dittomusic.com/)
I think Soundcloud has a very different audience. In my opinion hardly anyone cares about the hits over there. And it isn't a requirement to feature the hits in order to be successful. Ask Bandcamp, they are doing quite well with their endless niche catalog.
Personally, I consider myself a mostly digital crate digger who loves to explore obscure music and forgotten gems. Soundcloud is really helpful when trying to keep up with some of my favorite labels - an institution Spotify & Co. couldn't care less for. Soundcloud surely doesn't have everything but at least it fills some of the huge gaps, that Spotify, Apple or Google aren't interested in at all.
This makes it almost unusable for discovery on mobile, since I have to scroll... and scroll... and scroll... while trying to glance at track names in between flashy pictures. And the runtime in the stream disappeared quite a while ago for no reason I can think of.
Ripping off Facebook really doesn't work for a music app. Spotify at least has something pretty usable (though that too has gotten worse).
I really like the idea of SoundCloud and still use it regulary, but they really need to enhance their UX in all clients.
I fear that the VC/investor zeal for monetizing the hell out of SoundCloud will ruin what has made SoundCloud so special, and that sure, it may some day be worth more than Spotify, but if so I suspect it'll devolve into something less than its present goodness, and an inevitable drop in valuation will follow, leaving VCs scratching their heads.
So it goes with every good online music service. They come, they go. Investors cash out, users get screwed, same as it ever was.
I hope that in the coming months they catch up to Spotify's performance.
There are plenty of examples to pick from, but the one change I never understood was the comment system. Timestamped user comments set directly on the waveform of the song was the one truly unique feature they had and they stripped it out completely. Months passed before it was even possible to view or create comments from the app, and even now they're locked away behind an obscure menu and only display in a useless list, entirely removed from their original context.
They've tried to backpedal slightly by bolting on some of the missing features, but the new app was clearly not designed with them in mind in the first place. I would be honestly surprised if they manage to catch up.
Consumers buy tickets to a DJ's show, DJ pays indie label, label pays artist. So three things should be clear: first, DJs aren't on Soundcloud to get signed to a major label, they are trying to drive ticket sales; second, unknown DJs don't use Soundcloud to promote themselves because ticket buyers must be local.
Finally, amateur artists don't care about developing a following like YouTube stars because their music is sold to DJs, not to listeners. Part of the appeal of a DJ is that you hear great tracks at their events that you never heard before, so they aren't going to want to buy viral Soundcloud hits that the audience has already heard.
In short, the mainstream music economy is driven by MP3 sales/streams directly to listeners. The underground music economy is mostly about event ticket sales, and Soundcloud is valuable to artists if it can drive ticket sales. That's why its current monetization strategy is mostly about telling artists which cities their fans are in. Frankly, if I were Soundcloud, my next step would be to build a ticketing platform.
When I am shopping for music, which is what Spotify is supposedly for, then I think it is not enough to supply the music in digital form. The physical form that is independent of any current DRM annoiance and/or online website service is missing. For the music industry though, Spotify seems to be a pretty good model, where they can sell their stuff.
Soundcloud seemingly is a place to get recommendations on artists that I might like or a place to listen to music from independent artists. While there seems to be a lot music on Soundcloud, it may be a little too much. You might get lost in the noise and the community and algorithmic recommendation filters might not be enough. For the ones actually creating original music, Soundcloud seems to be a "free beer" approach. People get to listen to your music, but all you get in return is limited publicity. That might not be an enduring model for music creators, just during their initial phase of getting known.
Thus maybe another platform will emerge.
I would love to see an official Soundcloud app, so I can use it on my desktop 24x7, but it doesn't seem like that's happening either. I just don't understand what they're actually up to, other than being the place the random average person will plop their latest track.