Swedish audio site Sound Cloud, has been providing a musical outlet for bigwig musicians, aspiring artists, and music lovers of all kinds for years. Although SoundCloud and its site managed to maintain their services to the public commercial free for a total of eight years, a hidden contract regarding this is hitting the surface that they may soon be captured by the bandwagon that competing musical outlets are riding.
Sites and programs such as Spotify, MySpace, and Groove shark are all services that promote a subscription-like service in which royalties are paid. This is simply a way users can listen to music in exchange for a few minutes of ads.
Royalties, or money paid by musical sites to play music, has been a trending movement for many musical outlets. Broadcasting with commercials is a primary way to pay for such royalties.
Record labels are getting paid for their artists’ music to be broadcasted on programs such as Spotify, Myspace, Grooveshark and quite possibly Sound Cloud as well.
Currently, Sound Cloud disregards ads, and only offers upgrade options for users trying to see their status as a user by going pro.
Fader magazine clarifies that this “commercial” contract is in effect as a three-tier subscriber service, meaning there will be three different levels for listening to certain selections of music. The site’s services will include a choice between a free service, a semi-free service, and their most expensive service, which will contain the maximum amount of music available and of course is ad free. Fader also makes mention that the streaming revenue acquired from members would be “18 cents a month for each individual with a “Full Catalog” account, and 80 cents per month for each individual signed up with an “Additional Services” membership.”
Some of this hidden contract is said to be slightly similar to the contract of a Spotify/Sony contract that released last May.
Jada Braxton is a Collegian staff writer.