SoundCloud will now handle distributing your music – and give you a 100% cut

SoundCloud has a new pitch to creators: upload your music not just to SoundCloud, but to all major music services, too. Distribution is launching in a new beta as part of Premier service, and the terms look appealing.
Okay, first, to understand what digital distribution is, let’s go back in time. Digital music for many years meant primarily CDs and … well, piracy, despite some early (fairly horrible) stores. Then along came Apple’s iTunes Music Store. When it launched, you needed to have a label deal of some kind to make your music available; Apple dealt with those labels much as brick and mortar stores deal with labels and distributors. The first loophole was CDBaby – the name is a reminder that at the time, independent music producers were still largely duplicating releases on CDs. Pay for CDBaby, and you get your music on iTunes for sale.
Now, the landscape is different. Apart from DJs and specialists, most people get their music through streaming services. But the only major destination where you can upload music directly these days, apart from Bandcamp, has been SoundCloud (though Apple and Spotify may soon change that).
So if you want your music on other services, you typically sign a distribution deal. Some of these are pay-once or subscription services open to anyone. More traditional distributors require multi-year contracts you can’t get out of – though they may offer personal relationships with curators at online stores, and the promise, at least, of getting you placed as “featured music” or on playlists.
If you just want to get your music out there, the issue is that the distribution costs can actually cost more than you bring in.
SoundCloud’s offering, then, could be at least cheap and convenient. Here’s how it works:
Qualified users with a SoundCloud Pro or Pro Unlimited account can sign up for an open beta right now. (That’s all countries that offer SoundCloud, by the way – 190 of them.) The only restriction is a minimum number of plays from particular countries, at least for the beta.
You can select original music to distribute to a range of services, including Amazon Music, Apple Music, Instagram, Spotify, Tencent (the leading Chinese network), and YouTube Music, inside your SoundCloud account.
Then you keep 100% “of your rights” (need to read the fine print on that), plus 100% of distribution royalties from third-party services. There’s no additional cost for distribution.
Most other services either take a cut of royalties, or charge fees for distribution; here, what you’re paying already for your account already covers those costs.
So wait, what’s in it for SoundCloud if you get all the money? It seems the main goal is to attract users to their subscription services and provide monetization options to keep them there. In fact, you don’t have to include your music on SoundCloud or monetize it there if for some reason you don’t want to – like if for some reason you want it just on Apple or just on Spotify or some other combination. SoundCloud hopes you will, though; a spokeperson for the company tells us, “Monetizing tracks through SoundCloud Premier monetization gets creators the best revenue share rate on SoundCloud and fast payouts.”
I suspect SoundCloud does hope to use this offering to help build up their catalog, of course – which makes sense for them. The big challenge SoundCloud’s business faces is, while the service has a lot of original music the likes of Spotify and Apple lack, their catalog still lags the major music a lot of people want to listen to. And they’re in the unique position of wanting to attract both creators and listeners. That could be good in the long run for us as creators, but so far it’s meant that we tend to use SoundCloud as a way of building audience for other services (and for a lot of us, trying to convince people to buy downloads or physical music).
SoundCloud’s creator-facing tools are essentially unparalleled; the limited tools on Spotify and Apple are fairly weak and confusing. The real pitfalls here aren’t so much about SoundCloud as they are about streaming – streaming revenue for a lot of smaller artists is disappointing or even nonexistent. And this won’t help your music get playlisted or found on those services; it’ll just get you over the initial barrier of distribution.
In other words, I think generally the pricier services for distribution that just dump music on streaming are going to get run out of business, in favor of offerings like SoundCloud’s. But that leaves opportunities for distributors who do work on promotion, as well as the “we’re not dead yet” strangeness of cassette tapes and vinyl still being viable distribution formats in 2019.
Do you qualify?
The open beta requires a SoundCloud Pro / Pro Unlimited subscription, and you have to be an adult (18+ or age of majority).
You have to control all the rights to your music. So if you’ve signed music to a label, for instance, or you have an existing distribution deal, you can’t upload even your own music – technically, you’ve signed away the right to do so.
You also can’t have any copyright strikes against you on SoundCloud. That’s a dicey issue, I know, though SoundCloud points CDM readers to copyright@soundcloud.com if you’ve got a question about copyright policy or you have a strike against you.
And you need at least 1000 plays in countries that have advertising available – US, UK, Canada, Australia, France, Germany, Ireland, The Netherlands, New Zealand.
It seems you don’t necessarily have to be living in one of those countries, however.
When do you get data or get paid?
This is the part I really like. You get monthly reporting of numbers from all the services where you’re distributing. There are monthly royalty payments, with no minimums.
This is a big break from the truly terrible way the industry often operates, which is to lock you into long-term contracts, take a big slice of the money you’ve earned, and then make data hard to retrieve and slow, and hold up what money is left based on weird payment schedules or minimum thresholds.
So the appeal of just logging into a SoundCloud account and taking care of all of this – leaving time for you to go figure out who to talk to to make your music popular – that’s hugely appealing.
There’s a separate music ecosystem of DJ services like Beatport and Traxsource, plus of course the isolated but artist-friendly world of Bandcamp. I hope to check in with both those services soon.
And there will still be room for distributors who offer more advanced customer service and relationships with those outlets, or bundle distribution with other services (including label management).
For everything else, though, the new SoundCloud offering looks like a significant breakthrough – at least for those using SoundCloud already who want an integrated solution. I’ll be testing the beta. Let us know if you have questions about this and we can ask our Berlin neighbors at SoundCloud.
For more or to sign up:
creators.soundcloud.com/premier
@creatorsonSC on Twitter
The alternatives? Judging from comments, maybe I wasn’t clear enough on this. There are an array of choices out there, and a lot do now fall in the same price range or cheaper than a year of paying for SoundCloud Pro. Some of the early innovators in this space are no longer competitive on price – TuneCore being a prime example.
The current reigning champion I agree is DistroKid. If you just want an inexpensive, easy way to get your music into basically any mainstream online store, DistroKid does that with a 100% share to you for just twenty bucks a year. And no, so far SoundCloud doesn’t appear to offer any particular advantage other than simplicity for existing Pro users (though that is I think possibly a pretty big advantage). One big question here – while DistroKid easily has an edge in the USA, I’m not certain that it’s as well localized as far as payment plans and other details in other countries; I’ll try to research that.
Also worth checking out is Amuse, which offers free distribution and a 100% cut. (They say they’re free because they discover music for their parallel label effort, which earns money.)
Where this does get more complicated is as your needs progress to more sophisticated distribution and management beyond just uploading your music. There is seems necessary both to compare SoundCloud’s offering to similar tools for entry level use, and to examine some more specialized tools for advanced users.
This is definitely a smart move for SoundCloud. Whether it’s the right move for you is another matter. But it is a strong offering in a world that hasn’t been so friendly to independent creators in the past.
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