Earlier today, Soundcloud, one of the kings of online music sharing, has announced they will be officially partnering with Warner Music Group. Although there are no confirmed details as to the terms of the deal, it was their first with a major record label. The two music powerhouses will both take part in the \’On Soundcloud\’ ad program which was launched in August of 2014.
“We’re thrilled that Warner Music Group will be the first major label to join our new creator partner program,” said Alexander Ljung, SoundCloud’s founder & CEO, in a statement. “We expect to generate significant revenue for Warner and its artists in the months and years ahead as we roll out an ad-supported offering and subscription service that delivers real value to the industry.”
Last month, Tech Crunch reported that SoundCloud lost $29 million dollars in 2013, so their eagerness to merge with an established entity in the music business like Warner Music Group can be understood, but Warner definitely stands to gain from SoundCloud\’s hands-on approach to delivering music to the public.
SoundCloud has the ability to do for Warner what YouTube did for Google and vice versa. Both began as simple ways to upload and share content, and now both have been discovered by celebrities and business leaders as two of the easiest ways to plug themselves and their ideas. Consider if this deal with Warner leads to SoundCloud being barred from catering to other large labels such as Sony and Interscope. Artists on Warner like David Guetta and the Flaming Lips will immediately have a step up on the competition as SoundCloud is just another extension of the internet.
“This leading-edge partnership reflects WMG’s commitment to establishing new and alternative business models that recognize the value of music for our artists,” said Rob Wiesenthal, Chief Operating Officer/Corporate, WMG in a statement. “SoundCloud is a platform built on music innovation and it has a rare ability to drive music discovery while enhancing the connection and collaboration between an artist and their following. Our deal will foster that relationship, while providing a powerful range of income opportunities for WMG’s artists and songwriters.”
Anyone with a smartphone can look up a tune on SoundCloud anywhere they have reception, and the SoundCloud app makes finding new music even easier. Now with the mighty Warner Music Group on their team, SoundCloud has the opportunity to step up to the next level and become an established internet powerhouse just like Facebook and Twitter. I\’m just hoping they don\’t resort to playing ads before every song.
