After laying off 173 employees earlier this month, SoundCloud CEO Alex Ljung assured listeners and artists that the company was in control of its “independent future” and on a path to “profitability”, but most think differently. One of its former partners AudioMack blames SoundCloud’s misfortune on the company focusing more on venture capitalists and bankers instead of the users and the artists that helped them become who they are today.
It started back in 2014, when SoundCloud signed a deal with Universal Music Group and allowed them the right to remove content that it believes infringes its copyrights, without any involvement from SoundCloud itself in the process at all. Soon after a lot of DJs were complaining that their mixes, podcasts, and amateur radio shows began to disappear from the platform which ultimately forced the DJs to find other platforms to share their work.
To help buy time for the company to fix its financial issues, the CEO laid off some employees to slow the bleeding of its cash flow. According to Ljung, the company should have enough revenue to work until the end of the fourth quarter in hopes of landing some more funding to fix the company.
After the news came out of the most recent developments, Chance the Rapper tweeted out that he is ‘working on this SoundCloud thing.’ If he does decide to go through with possibly investing into SoundCloud would he even be able to turn it around?
To be honest, I feel that’s this case he will be no better than Jay Z and the other artists when they took over TIDAL. With Chance the Rapper getting behind SoundCloud I do see some positive changes that could drive people back to the service. With Chance, they would have a greater push in promoting independent artists than those names who are signed to labels. The copyright issues would still be an issue unless they find a way where DJs could possibly use the service without fear of possibly being suspended. It’s Pro accounts aren’t going to be able to complete with the top three streaming services so they will have to develop another way to gain revenue. Overall there will be a lot of work to get SoundCloud back on the right path. We will see how this pans out.