Although it’s probably best-known as a music platform, SoundCloud has a fast-growing business in other kinds of audio too, from weird field recordings to the spoken word. There are all kinds of sounds in there.
And now that repository is about to pay off for some of SoundCloud’s 20 million users – and for the company itself. SoundCloud has just signed a deal with Getty Images that will make it possible for those users to license their sounds to anyone who’s willing to pay – most likely advertisers and other creatives.
It looks like one of Berlin’s biggest success stories has just revealed its big new business strategy.
“SoundCloud’s partnership with Getty Images Music creates a powerful offering to our community of professional and casual creators,” SoundCloud CEO Alexander Ljung said in a statement. “Now through Getty Images Music, songwriters and audio creators can broaden their exposure and potentially monetize sounds they’ve shared on SoundCloud.”
The system will be quite straightforward: each user will be able to install a ‘license’ button from Getty Images Music on their SoundCloud players, for tracks that they want to monetize. Those who want to license the track just click the button and send a request.
Beyond that, depending on how much contact information the SoundCloud user has provided, and whether or not they’ve already sent a tax form to Getty, it will take between a few days and a few weeks for the track to become available.
Getty’s rate card details how usage in web or mobile advertising will cost $ 350, inclusion in corporate marketing will cost $ 1500, and so on. The creator gets “35 percent of the upfront licensee fee plus 50 percent of Getty Images’ share, as publisher, of any backend performance royalties”.
And what if the user’s sounds get used in something that’s broadcast? Depending on what type of licensing that’s been chosen by the user, Getty registers the track with performing rights organizations and administers the royalties – 100 percent of the ‘writer’s share’ goes to the creator, along with 50 percent of the ‘publishing share’.
Finally, a strategy
Funnily enough, I’d noted before that Getty was sniffing around the Berlin scene, but I’d assumed that the fruits of that interest would be seen first in a collaboration with an image-centric service, probably EyeEm.
So this news came somewhat out of leftfield. On reflection, though, it makes complete sense.
SoundCloud is the pioneer and leader in what it does, i.e. being a YouTube for audio. It’s wildly popular, but its monetization strategies appeared limited. Audio-player deals and those pro-account subscriptions could only take the firm so far.
The horrendous likelihood was that SoundCloud would adopt audio advertising. Maybe that will still happen, but it would drive away many users – particularly as SoundCloud does not tend to offer the same kind of continuous listening experience found in the likes of Spotify.
This makes far more sense, and it should attract rather than repel users. But it will rely on SoundCloud improving its discovery process. I expect we will soon see the company beefing up its semantic-tagging efforts.
