Originally, Berlin-based music tech startup Loudly’s aim was to build a platform that let users quickly remix songs with the help of its AI. One swift pivot later, and Loudly now offers online creators brand-new, high-quality, personalised, and royalty-free music to be used however they like.

The switch to offering AI-powered music to creators comes despite Loudly’s AI-remixing technology sounding like the kind of things that fans, artists and labels all want: users would upload a track, and then Loudly’s AI would create remixes in different genres. The mix could then be downloaded, perhaps tweaked in a DAW, and shared. The AI seems to work well – whipping MØ’s ‘Blur’ into various remixes, including drum’n’bass, trap, and a ‘stripped down’ (i.e. acoustic) version.

Building on experience gained from sibling product Music Maker Jam – the smartphone music creation app that has been around for nearly a decade and has 25m installs – CEO and co-founder Rory Kenny had an idea. “Wouldn’t it be great if people could remix tracks by artists they love? So we went to labels and there was interest.”

However, Loudly then faced a familiar problem: licensing. It became clear that it was simply not possible for Loudly to work in the existing licensing framework: “The rights around a track mean that the public cannot remix and create a derivative without agreement from the master rights holder.”

Kenny has sharp words for the current approach to licensing. “The moment that, as a startup, you get into bed with a major music business player is when you stop innovating and start counting pennies – because you don’t know if you can survive after a year, based on the revenue share.”

It wasn’t just the law that caused Loudly to pivot away from its original ambition. “There was a second, technical, problem: if you wanted to remix a big artist, we found that the big rightsholders don’t have stems or the original audio loops. The producers and artists don’t always send them to the labels – so they don’t even have the basic elements for this system to work.”

Coming from the tech industry, where every bit of code is archived and retrievable, Kenny’s surprise is palpable: “They own the stems but they don’t have access to them! We wanted to work with them, but to achieve what we’re aiming for, the music industry cannot provide the music in a way that serves this new era.”

These two hurdles meant Kenny and the team leaned on the strengths of Music Maker Jam – where all the loops and samples in the app were created by real human producers – and pivoted.

“We spent the last year creating our own music catalogue so that users can remix it in a way they want. So we’ve effectively created an AI-powered catalogue. We’re being radically autonomous from the music industry as it stands.”

Now, Loudly has turned its attention to the creator community: makers that are eager for good royalty-free music to use in their YouTube videos, livestream events, or in games. The new product is Loudly AI Music Studio: a set of tools and building blocks to create music – with the benefit of an AI “co-creator” to help users create the most professional-sounding track possible.

The results can be impressive: this hip-hop track might lack some of the swing and humanity of a J Dilla beat, but it gets close. And in any case, Rory says, Loudly isn’t trying to compete with humans: this is music designed for humans to adapt or use in the content they’re creating. The examples proffered by Loudly, like the above hip-hop track, or this EDM beat, would sit very comfortably in a video game or on a YouTube video.

YouTube video

How does Loudly work?

It’s tempting to draw loose comparisons with Roblox, the game-creation platform which has quietly built a base of more than 150 million monthly active users. Loudly users set a few parameters – genre, instrument, loops, and one-shot sounds that they like – and Loudly’s AI sifts through their catalogue of “over 100,000 professional audio loops” to sequence those loops and sounds into full tracks.

Users can download the stems to further tweak and mix in a DAW, hit a button to generate a new track, or simply download a track they like to use wherever they make content.

“Our goal,” says Kenny, “is to fully democratise access to music creation, and sharing that music easily with the world.” He sees the impact of AI on music creation to the big step-changes of the past: “the introduction of the DAW meant a massive shift towards the number of people who could create music at a fraction of the price compared to before. The end result is that SoundCloud has 50 million creators who upload music: you go from thousands of creators to millions.”

It’s this liberating effect that Loudly believes it can capitalise on – and is why Kenny is so focused on what he sees as a large group of under-served creators.

“Now we have the AI era. If the end result of the digital era is 50m creators globally – the next era is a billion people with access to make music in ways that are fun and easy,” he says. “Our AI tech allows us to produce our own music catalogue and provide services so that anyone who wants to can create royalty-free music So we’re moving into the creator economy.”

Professional producers can use it too, says Kenny: “Let’s say you’re good at making techno but not at trap, and you don’t create your own samples – you can use our AI Studio today and create trap music at the touch of a button. The AI provides a rough sketch for you to edit in a DAW. The AI can create endless variations of a track, so if you have writer’s block you can hit the button until you get inspired.”

Loudly AI Studio

How does Loudly make money and what does the future hold?

Having initially focused on existing music creators, Loudly now spies an opportunity with the “under-served wider creator economy – anyone from a TikTok newbie to an influencer on YouTube, or a fitness influencer on Instagram.”

All these creators of videos, apps and digital projects have to make regular new videos that use music, and Loudly’s tools allow them to create royalty free music that can be used on all platforms The Loudly AI Studio pricing structure has two tiers – Standard, for creators’ channels, which costs $9.99pm, and Pro, for creators whose work includes advertising and client services, at $19.99pm.

“We are now a rightsholder – we need to release the rights of our music to the creator economy, so we need to own it completely. We’re trying to solve the rights issue, because the new users and that economy are not versed in music rights – only the music business knows. So to serve the long tail, you can’t expect them to understand. Our solution is: buy a license and use the music for your YouTube channel, and if you want to use it in advertising, [our license is] at a higher price point.”

The creators he’s pitching towards want flexibility and scramble to new places to be creative – so he wants Loudly offer music that adapts. “As platforms evolve, music will need to integrate in new ways – and we allow that.”

Meanwhile, those platforms in need of music are becoming more diverse than ever. “It’s no secret that Facebook is investing heavily into a VR metaverse. Roblox is the fastest growing gaming metaverse. They don’t need music as we know it, but music that suits their theme – where a user can create music as bricks built into their framework. If they want creative adaptable music, those companies should work with us.”

Who are Loudly’s main competitors?

Kenny has praise for other businesses in the same space, but says that comparisons are tricky. “It’s good to measure AI music companies against their genre. I’m quite impressed by Aiva – they create music compositions and sounds automatically and are very good at ambient and classical. We’re not good at classical, but are good at modern progressive genres like EDM, trap, and house,” he says.

“Boomy have done a great job at showing the world how to create instant music on an app – they’ve created a new experience for the users. Mubert are really cool and I like what they’ve done.”

Loudly’s original use-case has parallels with the emergence of the sampler in the early 1980s: another technology that liberated creators, created whole new types of music, and – from the music industry’s perspective – rode roughshod over copyright law.

But whereas classic albums like De La Soul’s ‘Three Feet High And Rising’ were released before copyright law caught up, is Loudly’s original dream of creating automated remixes of popular music dead in the water? Could rightsholders with access to the stems and are willing to strike an acceptable deal, use the service?

Kenny is clear that this is not a priority right now – but is hopeful. “If someone in the industry wants to explore a partnership, and is willing to put their music and stems in our system, and let people play with it… we could definitely pursue that – we want to experiment and collaborate with artists, for sure.”

AI Music Studio is still in beta, and is currently only available through a dedicated Patreon page.

Need to know: Loudly factfile

Category: AI Music; Music creation
Headquarters: Berlin
Management Team: Rory Kenny CEO & Co-Founder, Gabriel Hacker CPO & Co-Founder
Funding so far: Zero institutional funding. Cash-flow financing in 2020 = $1.5M

Loudly is currently seeking to develop relationships with: media tech platforms, music industry, Artists

Contact details: rory@loudly.com

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