SoundCloud continues intl roll-out of subscription service

SoundCloud continues the international roll-out of its subscription service, after launching SoundCloud Go in the US in March.

This week it was introduced in the UK and Ireland with a 30-day free trial. Swedish born and Berlin-based co-founder and chief executive Eric Wahlforss says more global markets will follow.

Whether Australia will be among the early take-on is not confirmed. SoundCloud is in on-going negotiations with collecting societies in different territories.

Founded in 2008, the music and audio streaming service became a hit by allowing users to upload their own songs and mixes, exclusive tracks from major acts and being a place to find new music and podcasts. Drake, Prince, Lorde, Snoop Dogg, Beyonce, Lily Allen and Miley Cyrus are among those who have previewed new music on SoundCloud.

In January it was valued at US$737 million (A$978.3 million).

This week it also introduced audio and in-stream native ads for its free streaming customers, as well as promoted profiles and creator partnerships.

“Just like in the US, we are sharing part of that advertising revenue with a growing number of creators,” the company stated. “When you hear an ad, artists get paid.”

Determined to take on Apple and Spotify in the UK and Ireland, SoundCloud Go charges £9.99 (the equivalent of Australian $19.40) per month like them. Users can also access an expanded catalogue of 125 million tracks without an internet connection.

The service continued, “SoundCloud will continue to be the place to listen to, discover and share new tracks from emerging and established artists for free. With SoundCloud Go, that experience has been taken to the next level with access to even more tracks and offline and ad-free listening.”

Following copyright disputes in the past, SoundCloud struck licensing deals (which included royalties for artists used in remixes) – first with Warner Music and indie label group Merlin in 2014, and Universal Music and Sony this year – to offer no-ad subscriptions. Last month it struck a multi-territory European licensing agreement with publishing giant Sony/ATV Music.

“It is too early to talk about numbers, but what we are seeing so far is very promising,” Wahlforss said about SoundCloud Go’s American launch.

Its international roll-out may well face challenges. Its rivals already have a strong foothold in the competitive streaming market.

Research in January 2016 by music industry research body MusicWatch, showed that SoundCloud users are three times more likely than the average streamer to subscribe to a number of streaming services. So it needs to lure its users back from rivals as Spotify (30 million subscribers) and Apple Music (13 million). SoundCloud’s last official figures, released in December 2014, put its numbers at 175 million.

But SoundCloud’s overwhelming strength is that, with SoundClouders collectively uploading about 12 hours of audio every minute, it still has an exhilarating unpredictability about its 100 million-plus tracks and a reputation for where the latest trending music is found. It also has more content than Spotify.

In an interview with the BBC, SoundCloud’s other co-founder Alexander Ljung further pointed out, “For artists generally, one of the things that’s special about SoundCloud is they have their own account, which they control.

“So that’s led to a different degree of authenticity. If they have an idea they went to get out to the world, a bit like Twitter, they can publish it instantly. That’s become a really powerful way for artists to connect to fans. They can’t really do that anywhere else.”

Subscribers will be offered exclusive features which will expand SoundCloud’s revenue stream.