SoundCloud is a big name among musicians, DJs, podcasters, and more, but the Berlin-based company has seemed uncertain about how to go about generating revenue from its user base. Last year SoundCloud inked its first deal with a major record label, and now the company seems to be looking at monetizing copyright-infringing tracks.
A partnership between SoundCloud and rights management company ZEFR was announced yesterday, and while the wording was a bit vague, plenty of clues can be gleaned from ZEFR’s existing partnership with YouTube.
Two ZEFR products, Content ID and Brand ID, are the brains behind many of the ads and links you see that are related to the video you’re watching. By working with record labels, ZEFR ensures that, even though companies may not get any revenue from the ads on the song you’re watching a copyright-infringing video of, you’ll at least be presented with an easy way to buy the song on iTunes.
Given how well the partnership seems to have worked for YouTube, it’s easy to make the assumption that this is how the partnership between SoundCloud and ZEFR will work as well, but no specific information has yet been given.
“Working with ZEFR, SoundCloud is taking another step to becoming the powerhouse player in the digital audio business,” SoundCloud co-founder and CEO Alexander Ljung, said in the press release announcing the partnership. ZEFR co-founder Zach James was equally opaque, saying, “We are excited to use our technology and expertise to help make SoundCloud a go-to platform for content creators and advertisers.”
Reading between the lines, it does seem that monetizing the many remixes that appear on SoundCloud could be a major goal of the partnership. A focus of the deal SoundCloud signed with Warner Music Group last year was to generate revenue from mash-ups of the company’s music, and ZEFR co-founder Rich Raddon told Engadget that a major aspect of the SoundCloud partnership was providing insight into remixes.
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