As SoundCloud Struggles to Stay Afloat, Investors Begin To Abandon Ship


Similar to how Rome’s greedy reach caused its eventual downfall, SoundCloud’s consistent efforts to monetize its services have left them stumbling towards a crumbling culmination over the past few months. SoundCloud is a service that accrues over 175m listeners a month, and with a company that was just valued at $700m, investors are left wondering how they will get a cut of the mere $60m brought in last round.

A staggering amount of audio is uploaded to the music-streaming service on a daily basis. This is the primary reason why it quickly rose to be not only an endless pool from which talent can be discovered, but also a way for labels to promote the talent they have already brought to limelight. The momentum that followed the explosion of the service was monumental, and soon three of the world’s biggest labels (Universal, Sony, and Warner) wanted a piece of the pie.

And while they still remain interested in finding a way to be cut in on such an influential service, it is impossible to deny their frustration with the same service that cannot, for the life of them, find a way to make a penny from their user base. In actuality, it would seem that the harder they try and find ways to make ends meet, the more backlash they receive from their user base. Regulations of copyright infringement, which result in countless tunes being taken down alongside intensive crackdowns on the violator’s personal account, have created anti-platform campaigns with some of the biggest artists in the industry as the frontline advocates against the Berlin-based music site.

Presently, we are at a ticking time bomb situation. If left to detonate, will more investors follow suite behind the likes of Universal and Twitter, who recently abandoned negotiations for licensing and acquisition deals respectively? The main issue would seem that labels do not want to jump on board such a service until they see a profit, and SoundCloud cannot turn a profit until labels hop on board by permitting music to be licensed through the service. This puts SoundCloud in a dangerous position, as other viable music streaming sites such as Amazon, Apple, and Google wait patiently for SoundCloud’s reign to crumble, leaving the crown for the most popular streaming site up for grabs.