SoundCloud is reportedly set to launch a subscription-based service in early 2015 after striking a deal with Warner Music Group.
Techcrunch reports that the Berlin based streaming site has reached the landmark of signing its first agreement with a major label- prior to this, SoundCloud’s negotiations with the major labels had stalled, with Warner, Sony and Universal all reportedly in deadlock over licensing terms. The Warner deal will apparently not feature all artists signed to WMG labels but the label will receive equity in the form of a stake in SoundCloud’s business alongside per stream royalties.
SoundCloud’s Founder and CEO Alexander Ljung said: “We’re thrilled that Warner Music Group will be the first major label to join our new creator partner program. We expect to generate significant revenue for Warner and its artists in the months and years ahead as we roll out an ad-supported offering and subscription service that delivers real value to the industry”.
Last month it was revealed that the service posted a $29m (£18m) loss on revenues of $14m (£8.7m) in 2013. In July 2014, 17- year veteran of Warner Music Stephen Bryan joined SoundCloud as a Senior Vice President of Business Development and Strategy.
Presumably, talks are ongoing between SoundCloud and the other majors- Universal Music boss Lucian Grange recently commented that SoundCloud could “Generate incredible revenue- with the right model”.
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