SoundCloud becomes first streaming platform to embrace fan-powered royalties
SoundCloud has introduced “fan-powered royalties,” a new strategy that will revamp the way the streaming platform distributes money to its artists. The fan-powered royalty model of payouts is driven directly by an artist’s fan base. With this move, each listener’s subscription or advertising revenue is distributed among the artists that they listen to (rather than their streams being pooled). This move—the first of its kind in the music streaming industry—is expected to benefit rising independent artists.
SoundCloud CEO Michael Weissman spoke about the platform’s decision to restructure its payment model in an official release, stating,
“Many in the industry have wanted this for years. We are excited to be the ones to bring this to market to better support independent artists. SoundCloud is uniquely positioned to offer this transformative new model due to the powerful connection between artists and fans that takes place on our platform.” He continues, “The launch of fan-powered royalties represents a significant move in SoundCloud’s strategic direction to elevate, grow and create new opportunities directly with independent artists.”
SoundCloud has launched fan-powered royalties in the hope that this alternative to stream pooling will ‘level the playing field” between emerging and established artists. This strategy is also thought to empower listeners to support their favorite artists through streaming their music, now that there is a direct connection between streaming and an artist’s payout.
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