Cloud-music service SoundCloud today revealed its plans to launch a new advertising platform aimed at helping music artists make more money.
The launch timing of the new platform — dubbed On SoundCloud — seems to coincide with the impending launch of a YouTube-branded music service.
SoundCloud is known as a site where everyone from independent to established artists (as well as their fans) can upload concert recordings, experimental new tracks, and remixes. This is also something YouTube is known for, except it offers full videos instead of just audio. A YouTube music service could mean serious competition for SoundCloud, which is why the audio startup is eager to get its business strategy into motion.
As for that strategy, On SoundCloud will begin running ads on audio tracks for users within the U.S. The company said it hopes to roll out support for advertising in other countries in the near future. SoundCloud is also trying to sell its listeners on the reason ads are necessary right now.
“The introduction of advertising is an important step for creators. Every time you see or hear an ad, an artist gets paid,” SoundCloud cofounder Alex Ljung wrote in a company blog post.
The business model, however, involves targeting the artists themselves rather than just an audience of listeners. On SoundCloud will offer a subscription service to artists that comes in three different tiers. The first level (partner tier) is free to all creators and offers you the ability to upload new tracks, get listener analytics, and do a few other things. The pro and premier tiers offer more space for uploading songs, more artist tools, and more detailed stats. And the premier tier, which is by invitation only for now, also lets serious creators make money off of any ads that play during or alongside their tracks.
It’ll be interesting to see how creators respond to the new SoundCloud ad platform, and if YouTube’s forthcoming music service will give SoundCloud some serious competition when it finally does launch.