SoundCloud, the popular audio hosting/sharing platform, will soon be introducing in-stream ads into its media players. The service, which initially catered to musicians has since branched out into podcasting. And while SoundCloud’s podcasting program is in its third year of an invite-only beta program, many podcasters use SoundCloud for media hosting.
This begs the inevitable question: What will this new ad system mean for podcasters who host their shows with SoundCloud? At this time, it’s not entirely clear. All of the information that’s been made public so far only refers to the music side of SoundCloud’s services. Specifically that, along with the ad system, SoundCloud will also roll out a new premium service so subscribers can pay to skip the ads, similar to other music streaming services like Spotify or Pandora.
SoundCloud is going thru the growing pains of transforming from a startup to a revenue-driven company. Earlier this year, the service considered giving equity to major music labels in order to avoid being sued. SoundCloud has raised over $100 million from big-name investors like Kleiner Perkins. It seems only natural that the company would start to seek out more aggressive monetization strategies. From the New York Times article linked above:
“For its new program, Premier, SoundCloud will sign licensing agreements with music companies that will allow it to run advertising on its service. Most of the revenue from those ads will go to the content provider, said Jeff Toig, SoundCloud’s chief business officer, although he declined to be more specific.”
Good on SoundCloud for sharing revenue with content providers. But again, only “music companies” are mentioned here. The article goes on to say that some independent musicians will also be included in the new revenue-sharing system. But nothing is said specifically about podcasters.
Since the launch of its podcasting program, SoundCloud has been a divisive topic amongst podcasters. There are many who love the service and highly recommend it while others caution that SoundCloud’s commitment to the space is unproven. Hopefully, more details will emerge soon on how these new revenue-generating systems will affect podcasters. And for that matter, maybe SoundCloud will give us an update as to when they may take the podcasting program out of beta. Until we get some real answers on these questions, I’ll continue to remain skeptical about SoundCloud when it comes to podcasting.
Posted by Shawn Thorpe