Here’s how indie artists will make money with SoundCloud PremierOctober 10, 2018
Today, SoundCloud announced that it is opening up its direct monetization program to the public, finally giving most artists the ability to make money off of the platform. The program, called SoundCloud Premier, was created four years ago but has been limited to an invite-only beta until now. SoundCloud’s self-monetization move follows Spotify’s recent announcement that it would begin letting indie artists make money off of songs that are self-uploaded to its platform.
In order to qualify for Premier, you must be an independent creator with a Pro or Pro Unlimited account and have at least 5,000 plays in the past month from SoundCloud-monetized countries (which, for now, is limited to the US, UK, Canada, Australia, France, Germany, Ireland, the Netherlands, and New Zealand). Your account can’t have any copyright strikes against it, and you have to be 18 years old (or age of majority in your country). Only original content will be accepted, but there are hints that, in the future, other content, like podcasts, remixes, and full DJ sets, will be considered. Any songs monetized with SoundCloud Premier are non-exclusive, and the creator retains all rights.
As far as what the payout structure looks like, SoundCloud’s press release says it is offering a “leading revenue share” that “meets or beats any other streaming service,” with artist payouts occurring monthly. Participation in Premier is free (outside of the required subscription), and eligible uploaded tracks are immediately available to be monetized.
The Verge reached out to SoundCloud for clarity on Premier’s payment structure. A representative for the company says that creators who monetize with SoundCloud Premier will get a 55 percent net revenue share for the songs they upload and own the rights to. Additionally, SoundCloud will pay publishing royalties to rights holders and societies. This is the same rate that was given to Premier artists when the program was in beta, and it should be noted that the 55 percent SoundCloud is offering is more than the split Spotify is offering indie artists who self-upload (which is 50 percent of Spotify’s net revenue and 100 percent of royalties). The representative also said Premier songs will be available to stream everywhere but will only monetize when played from the countries listed above.
In addition, some Premier artists might also see income via brand partnership opportunities, something that was tested in the service’s beta. These brand partnership opportunities are sponsorship packages offered to Premier artists, sometimes for tens of thousands of dollars. SoundCloud says the path to involvement in these partnerships is varied — a brand could already have an artist in mind, while sometimes SoundCloud will recommend artists to brands.
However, even if SoundCloud’s share percentage is higher, that doesn’t necessarily mean payouts will be higher. Premier’s payment system is based on revenue generated from advertising and subscriptions, so how much money you make is directly tied to how much money SoundCloud makes. It also means SoundCloud’s payout rate can fluctuate month to month. This is different from traditionally released music on most other platforms like Spotify and Apple Music, which pay out flat rates per stream, per negotiations and deals with labels.
Historically, these net revenue-based payouts for SoundCloud Premier artists have been lackluster, with a prominent artist manager telling The Verge last year that “the payouts are less than one-tenth of other platforms.” Today, another manager told The Verge that they usually choose to not monetize their artists’ songs on SoundCloud because the friction is “not worth the $50 we would make.”
How profitable SoundCloud Premier’s newly public-facing program will be for indie artists remains to be seen. Even if limited to a few countries, the expansion is a necessary step forward for SoundCloud, which has always posited itself as a creators-first outlet. Letting all artists directly make any money off of the original work they upload to the platform is crucial for the company, especially in the wake of Spotify’s announcement that it will let artists self-upload and monetize their content.
But allowing indie artists to make money is a wholly different notion from SoundCloud being as profitable for artists as other streaming platforms (which many already perceive as not paying enough). One management company that handles several large indie artists who participate in SoundCloud Premier tells The Verge, “We’ve always operated under the understanding that SoundCloud doesn’t pay shit. So if that’s changing, we’d like to know how.”