The second biggest streaming music service after YouTube – SoundCloud, hasn’t paid royalties to the creators and rightsholders of the music for their plays on its site and apps yet. The benefits of the artists were that they can build audience of fans and gather data how and where their tracks are being listened to.
But SoundCloud has grown (the company is valued at $700m) and is faced the question when will start paying royalties to the artists.
The first step for doing this is started – the company is introducing ads, that will be shown or played alongside the music or other audio content, and the most of the money paid by the advertisers will go to the music creators.
The ads will only be seen and heard in the US for now, on SoundCloud’s own website and mobile apps – not in tracks embedded elsewhere on the web and/or listened to elsewhere in the world.