Insightful Bloomberg article (original published on July 10, 2015) that provides some context behind many of the recent, and less than popular moves made by Soundcloud. Bottom line, I think Soundcloud is trying to do the right thing and trying to establish a legitimate, legal, and safe platform for deejays and producers to upload their content. However, most of the big record companies don't share their vision and are simply not buying what Soundcloud is selling (yet). Warts and all, I hope Soundcloud succeeds because there simply are no other options (and likely it will stay that way if Soundcloud fails). You can read the article
HERE. Passages of note below.
...And yet, SoundCloud’s potential is fascinating, and perhaps unique. The
founders have ambitious goals that respond to changes in the way music
and sound are created and consumed. It’s a beautiful dream. So long as
all the crucial participants—labels, publishers, artists, SoundCloud
itself—can agree on how to share it....
...This sour note matters, because a significant amount of the
“grass-roots” material on SoundCloud is so-called derivative content:
remixes, mashups, and sample-based music built from existing songs
without permission. The company won’t discuss how much of what
SoundClouders upload makes unauthorized use of others’ intellectual
property, but it’s not trivial. If SoundCloud can convince the labels it
has a solution to that dilemma that will make money for everybody, it
would be a breakthrough...
...They also argue that it’s specifically because they’ve designed their
service from a creator’s perspective that they will ultimately win over
Big Music: They want to give rights holders, small and large, control
over their work. (In June, SoundCloud struck a licensing agreement with
an organization that represents 20,000 smaller labels, boosting the
participation in On SoundCloud.) But, they add, they want to do so in a
way that recognizes what music consumption has become and where it’s
headed. “Remix culture, derivative culture, is already, today, a huge
part of society,” Ljung says. And starting with On SoundCloud, their
plan is to create a way to make money on such content that will be fair
to everyone. “It’s something that we’re unlocking,” Ljung says,
declining to be more precise.
In their view, what’s happening in
the audio technology world goes well beyond a transition to streaming.
“It’s easier to create music, to collaborate on music, and to share it
instantly across the world,” Ljung says. “It’s much easier now to create
a new genre.” Maybe that means music that gets big fast, fades fast—or
morphs. A hit song will still matter, but perhaps less for its canonical
self than for the versions and variants it spawns. Access to a catalog
of past music or a momentous album-like release every year or two would
become less important than a steady supply of material that keeps fans’
attention.