It’s no secret that the music streaming platform SoundCloud hasn’t had the brightest of days recently.
In 2014, the Berlin-based site reported a $43.9 million loss while also reporting $19.48 million in revenue, leaving many investors and stakeholders in doubt of the platform’s future.
However, a recent report from Digital Music News and PrivCo has SoundCloud grossing a revenue of $27.9 million in 2016, a 43% increase from 2015.
So what caused this drastic spike? Many speculate that the increase was mostly due to a growth in advertising revenues and that potential acquisition discussions with Spotify could have also inflated the platform’s value.
However, developments in the music streaming industry could halt SoundCloud’s recent progress! SoundCloud’s biggest differentiation point was that users could upload unofficial remixes to the site, even after many battles with major record labels’ legal threats. This remained one of their key selling points until recently, when the first unofficial remixes were uploaded to Spotify and Apple Music.
The platform is still a key channel for major artists, producers and DJs to share their mixes. Despite this, some competing companies, such as Dubset, are also willing to distribute royalty fees for the same mixes, imposing yet another serious threat to the site.
SoundCloud has been a staple in the growth of electronic music for years. However, with an unclear picture of the future competitive landscape alongside an uphill battle to continue off-setting heavy losses, we expect some changes to occur in order for the SoundCloud platform to remain the preferred service for artists and producers worldwide.
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