Bypassing labels: SoundCloud launched direct deals with musicians - conditions were criticized

    Earlier we wrote that Spotify had introduced a similar system of deals with musicians. Now SoundCloud goes into this niche. However, the first version of the contract proposed by the site has been criticized. Let us tell you the essence of the matter, why the program was criticized, and what the company did.

    Photo by Jonas Bodenhöfer / CC

    What SoundCloud offers

    In early October, SoundCloud announced the launch of the Premier program. Every month its members will receive royalties, the amount of which depends on the number of auditions of their compositions. They will also get 55% of ad revenue.

    SoundCloud, like Spotify, does not require exclusive rights to post content. Music can be sold through other services - Apple Music, Google Play and the like.

    To participate in the Premier, musicians must fulfill several conditions:

    • Sign a contract with SoundCloud can only creators of the original music. In the future, the site plans to expand Premier to podcasts, remixes and DJ sets.
    • Artworks must recruit at least five thousand auditions per month in countries where the SoundCloud Go premium subscription is available . Now there are nine such countries - Australia, New Zealand, the USA and several European states.
    • Authors must have a paid Pro or Pro Unlimited subscription (six dollars per month).

    Why was the program criticized

    At first glance, SoundCloud offers favorable terms of the deal, but participants and journalists discuss a number of points that make collaboration with the site not so attractive.

    Full terms of the program published edition of The Verge . The text of the agreement with SoundCloud was provided by one of the Premier participants. According to him, the musicians could not read the full text of the terms of the program before they agreed to participate.

    The clause of the agreement, in which the participants undertake not to enter legal proceedings against SoundCloud, caused the most discontent. For example, if it turns out that a company illegally used a participant’s music in the past, it will not be able to go to court under the contract. This condition would apply to those who left Premier.

    In the first version of the contract, the site could at any time change the percentage of payments to musicians or cease cooperation with them. At the same time, the company was not obliged to report changes in conditions. The participants themselves should keep track of them in their personal area.

    Moreover, the performers had limited time during which they could challenge the amount of payments. It was six months after receiving the fee. For comparison: in the Spotify contract with independent musicians, this period is two years.

    It is also unclear how often SoundCloud was supposed to pay royalties. AT descriptionprograms on the site said that the money will come every month. But in the text of the agreement it was said that the company itself determines the frequency of payments. In this work would have to "earn" a minimum of $ 100 to start paying royalties. Although this model is not new for aggregators, the threshold for the start of payments in SoundCloud seemed to the critics high.

    How SoundCloud Responded

    After the publication of the treaty on The Verge and the waves of criticism, SoundCloud decided to change or completely remove many of the "dubious" provisions.

    A couple of days ago an updated document appeared on the network. In particular, the company agreed to notify the Premier program participants of all changes in funding policies (via email two weeks before their entry into force) and fixed the obligation of monthly payments in the contract. Thus, the possibility of changing the payment schedule was excluded. At the same time, the period for challenging the size of royalties was extended to two years.

    In an updated form, Premier looks much more attractive.

    Other company news

    In October, SoundCloud representatives made two more announcements. First, the company made a deal with a startup Dubset, which is developing a platform for licensing remixes. It works like this: DJs download music to the Dubset system, after which the program automatically determines the rights of the rights to the songs and samples.

    Integration with Dubset will help SoundCloud fairly distribute royalties between content owners, given that site participants download a large number of remixes. First, the system will work only with individual songs, and then it will be able to analyze long DJ mixes from several songs.

    Photo Best Picko / CC

    The second announcement - SoundCloud began to cooperateWith companies that develop software for DJs: Native Instruments, Serato, Virtual DJ, DEX3, Mixvibes and DJuced / Hercules. Now users of these programs will be able to stream and mix music from SoundCloud directly, without first downloading to a computer. The feature will be available from 2019.

    For more than ten years of work, the site launched a career for many musicians and even formed a new music  genre . We hope that it will continue to be just as cozy and will delight the audience with useful novelties and more.

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