It’s overly simplistic to suggest that SoundCloud’s problems in 2017 – including its recent major round of layoffs – are entirely rooted in its moves to secure licensing deals with labels and publishers, while launching premium subscription features for listeners.
For one thing, a move towards licensing was unavoidable given the industry climate around safe harbour. For another, there were other, deeper-rooted issues with its service.
On Friday, The Verge laid many of them out in a piece based on interviews with some of the artists and DJs who were part of the core community of creators that helped SoundCloud to grow so big in the first place.
It will be painful but necessary reading for the company’s senior management, as they try to figure out what kind of service SoundCloud should evolve into if it tries to stay afloat as an independent company.
The article traced back some of SoundCloud’s woes to its introduction of its ‘reposts’ feature in 2012 – something that ultimately became a tool for spammers of mediocre music as much as it became a curation tool for curators.
The Verge also suggests that SoundCloud didn’t do enough to crack down on ‘fake’ streams bought from third-party services – something Spotify has clearly taken note of – while criticising the back-end and front-end alike of SoundCloud’s premium tier.
“[My song] ‘Like It’s Over’ has almost 1 million plays on the non-monetised upload and 24,000 on the monetised one. It’s all so strange and messy. I don’t care about royalties off SoundCloud because it’s almost negligible,” said artist Jai Wolf.
“Their changes were hard on people that were in the middle, and they were hard on people that were at the bottom,” added producer and DJ Kill The Noise.
The key paragraph, to our minds: “Most of the indie artists upon which SoundCloud built its name still have no options to participate in the limited monetising programs SoundCloud currently offers. All the while, the company still has a heavy hand with policing content and issuing strikes while accepting creators’ monthly payments for accounts and placing ads on their content.”
All this is a reminder that for SoundCloud to survive, it doesn’t just have to figure out its financial headaches – a huge challenge in itself – but it almost certainly has to address the criticisms from its core creator community.
It’s not that they’ve left SoundCloud completely, but if they are focusing their energies on other streaming services, winning them back will be important.
Chance the Rapper’s endorsement last week may have been a timely confidence-booster for SoundCloud, but it will hopefully be paying heed to its critical friends too.