The relationship between the majors and Soundcloud has been complicated. The labels know they need the influential discovery and streaming service to help find new artists and to promote their own music. However, they are frustrated at the copyright infringement and lack of monetization opportunities present on the platform. Sony apparently is fed up with Soundcloud as the two parties are at an impasse over licensing negotiations. In response, Sony has pulled down the pages of more than a dozen artists including, Miguel, Adele, Hozier, Kelly Clarkson, Passion Pit, Leon Bridges and MS MR.
A spokesperson for Sony & Columbia said to Billboard that the recent takedowns were due to "a lack of monetization opportunities."
Soundcloud has grown into a music platform that cannot ignore its issues related to monetization now that it has over 350 million users, even though it only made $14.1 million in revenues during 2013, leading to nearly $15 million in loses. The situation is somewhat awkward for Sony and Columbia who have signed artists on their roster like St. Lucia, Dej Loaf, Krewella, Dillon Francis and ZHU that all became popular through soundcloud. London Grammar's stock rose dramatically with all of the unofficial remixes done for their tracks, a by-product of the free spirited nature on Soundcloud.
Soundcloud has been rolling out new features to allow artists to monetize their music, but they don't want to alienate their fanbase entirely in the process. Ads have been slowly rolled out over the past year and they announced an artist partnership program to give certain acts the opportunity to monetize further.
"We are in ongoing conversations with major and independent labels and will continue to add partners to the program, says a Soundcloud spokesperson. "We've always put control in the hands of creators, and anyone who makes music and audio can decide when and how they want to share it with fans, allowing artists to essentially broadcast out to the world the availability of new content.
Soundcloud has already signed a deal with WMG, but went to war with Universal. Now it is set to add Sony to its bad side.
Below is a piece of what is left from Passion Pit's account.
