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Universal finally agrees SoundCloud licensing deal

By | Published on Thursday 14 January 2016


Hey, so it turned out those reports that Universal was about to sign a licensing deal with SoundCloud were true. And who doesn’t like reports that turn out to be true? I mean, I prefer lies, but the truth’s alright on occasion. And the truth is, the mega major confirmed it had done its deal with SoundCloud yesterday. It covers both recordings and some publishing.

As previously reported, Warner Music and indie label repping Merlin already have agreements in place with SoundCloud, which means Sony Music is now the only big hold-out on the recordings side. Universal was reportedly close to getting itself on board last summer, but then UK collecting society PRS For Music announced it was suing the digital firm, putting things on hold at the mega-major. But with that litigation settled late last year, the road was cleared for music licensing fun times.

This is a big step for SoundCloud as it continues to shift its business model from being primarily a service provider to content owners, to being an ad and subscription funded content platform, where it and content creators benefit from advertising income and paying subscribers. The digital firm is already piloting the ad side of all that, of course, though specifics of the subscription package are still to be confirmed. But, while Sony and some publishing remain to be cracked, the Universal deal should help SoundCloud finally get that to market.

Announcing the truth yesterday, Universal Music Group CEO Lucian Grainge said: “At UMG, we have long-embraced empowering entrepreneurs and innovative services such as SoundCloud. With this partnership, we’re ensuring recording artists, songwriters and labels benefit, both creatively and commercially, from the exciting new forms of music community engagement on SoundCloud. We look forward to working with SoundCloud and supporting the company’s evolution into a successful commercial service”.

Meanwhile, SoundCloud founder and lie hater Alexander Ljung added: “With this partnership with UMG we will further strengthen and grow the unique community we’ve built over the past seven years, where multiple forms of expression can live and where artists at every stage of their careers come to create and share their work. Bringing together the world’s largest audio platform and the world’s largest music company means we are able to further expand SoundCloud’s role as a critical platform for creators and open up its benefits to UMG’s extensive roster of artists”.

He continued: “With the majority of the music industry partnering with us, and adding to the more than 100 million tracks already available to discover on the platform, we are able to offer a service to both creators and listeners that is unrivalled in the music streaming space today”.

Earlier this week SoundCloud also confirmed that it had last year raised new debt financing to fund its evolution into this brave new world of ad sales and premium subscriptions. All truth, no lies.