Sinking SoundCloudDid I just hear someone scream ICEBERG!?

A few stories and actions have recently come out that are reinforcing my nervousness about SoundCloud. The first thing I don't like about SoundCloud is they change the name of your file. That is such a small potato that has come out.

SoundCloud Lost 29 Million Last Year

According to an article on Tech Crunch SoundCloud lost 29 Million dollars last year. To date, SoundCloud has disclosed a total of $123.3 million in funding. That includes a Series D round from earlier this year of $60 million from Institutional Venture Partners and the Chernin Group. The Series D round of funding valued SoundCloud at $700 million.


How does something that is losing money get valued at $700 million?


A financial times article stated that talks with the major record labels have stalled.

An article on stated that “SoundCloud's revenue was $14.1 million in 2013, up 40 percent from the year before. But its operating loss was $29.2 million, up 100 percent. This means the company lost more than double what it made in revenue last year. ”

The reason according to the article is “Our overhead base has increased faster than our revenues.”

You think?

Must've been all that money you paid to get your Podcasting tool out of its three-year beta.

It could also be that (based on a financial times article) people uploading 12 hours of audio every minute. That can get expensive.

Trying to Go Legit – No Win Situation

The CTO of SoundCloud has stated that they plan on launching a subscription service, but the more money they bring in, the more important they get the major labels to come to an agreement.

DJ's who have been mixing music and doing mashups are finding 70% of their music removed from SoundCloud. This is due to their beefed up security to removed music that has not been licensed. They are trying to work a deal with the Major Labels. While they signed a deal with Warner Music Group (WMG) which has a 5% stake in the company. There is still Sony and UMG are threatening to sue.  So they are stepping on their current users trying to make the changes needed to get the major labels on board.

UPDATE: Sony pulled their music 

Good luck with that. Don't they say it takes 10 times as much money to bring back a customer than to get a new customer?

UPDATE: 8/30/15 Apparently Soundcloud is moving too slow are and is being sued by the British Music industry

But What About Their Pretty Player?

People kept saying, “But it's so easy to share.” Well recently they removed the ability to share on Facebook. Do they direct people to YOUR website? Nope, they send people to THEIR website.

In a recent post a representative from SoundCloud stated:

Thanks for getting in touch. In response to recent sharing issues on Facebook, we have implemented a change so that links shared to Facebook will not render into players, but will rather click through straight to your track's page on SoundCloud to play there. This way, we can provide a much better experience for your listeners, and putting your profile and sounds front and center gives them more opportunities to engage with your sounds.  ( I added underline and boldness for effect).

For the record when you share a file from on Facebook it turns into a player (get a free month at Libsyn using the coupon code sopfree).