Business News Digital

SoundCloud defends terms of monetisation for DIY artists

By | Published on Monday 29 October 2018


SoundCloud has responded to criticism last week about the terms and conditions of the monetisation programme it is now rolling out to all DIY music-makers.

Earlier this month the streaming firm announced that it was finally making monetisation available to all musicians on its platform who had a Pro account.

SoundCloud, of course, placated an angry music community a few years back by adding advertising and then subscriptions to its platform, and entering into licensing deals with labels, publishers and collecting societies.

But the option to monetise content on SoundCloud was only initially available to DIY creators on an ad-hoc and invite-only basis. However, it was opened up to more DJs and producers last year, and then to all musicians with a Pro account earlier this month.

The deal available to DIY creators has parallels with that offered by the other big user-upload site that allows monetisation, ie YouTube. It’s basically a 55% revenue share arrangement, with a minimum amount of money needing to be generated before payments are made.

However, an article on The Verge last week raised various concerns about the specifics of the template SoundCloud deal, in particular terms that allowed the firm to change rates down the line and which prevented a creator from suing the company over any past unlicensed distribution of their copyright-protected work.

User-upload platforms that have distributed plenty of content without licence in the past often seek to have that unlicensed distribution forgiven when signing deals with rights holders. But entertainment lawyer Jeff Becker told The Verge that it was “unusual, at best, for a platform to open their terms and conditions with a provision that requires the artist to entirely release it of all prior violations and infringements committed by that platform”.

Of course, if any creator did sue SoundCloud over the past unlicensed distribution of their content on the platform the digital firm would almost certainly scream “safe harbour”.

And while collecting society PRS did go legal at one point (before settling), few big rights owners have been keen to test that defence in court. Meaning the sorts of artists signing up to direct monetisation are very unlikely to pursue any such action. Although, at the same time, artists should always be wary of signing any contacts where they permanently give up any rights.

Still, although not particularly dealing with The Verge’s specific concerns, SoundCloud insists that its deal for DIY artists is, well, sound. “The SoundCloud Premier monetisation programme operates on a fixed net revenue share of 55% and monthly royalty payments paid net 45 days to creators, which exceeds most other platforms” the company told the tech site.

It went on: “SoundCloud Premier is completely non-exclusive, the creator always retains all their content rights, and reserves the right to exit the agreement at any time. We are always looking for ways to simplify our agreements for the benefit of our creator community, and will take the opportunity here to avoid future confusion”.