Aligning the Incentives of Artists and Listeners

Current Soundcloud

For those who are familiar with Soundcloud, it is one of the most popular destinations to listen to music, among others such as Youtube and Spotify. The great exception of Soundcloud for many years was that there were no commercials. With such extreme server costs of a freemium model, that has since ended.

Soundcloud has always been special to producers. If you need any explanation, producers often give away the same content they charge for on Itunes for free on Soundcloud. Artists know their true fans are on Soundcloud, receiving their new music on their timeline streaming page. Such is the culture of a site that was completely free for years, but now relies on advertising revenue, which presumably it splits with artists now.

My Soundcloud Rendition

Before the advent of Soundcloud commercials, paid streaming had just started becoming the norm for music services. However, along with my friend Jack Beckwith, we concepted a model which could align the incentives of listeners and artists alike. With nearly 90% of an artist's revenue coming from concert ticket sales and 6% from merchandise, any platform built for artists would include elements of these revenue streams. Integrating ticket sales and merchandise into the platform of true fans who follow their favorite artists on Soundcloud might increase revenue for the artists, making the service Soundcloud provides more valuable. From there, they might be able to charge more for artists using their platform, or rather, get a portion of all the sales as well. In a perfect world, Jack and I envisioned a system where credits from purchases of concert tickets and merchandise could lead to free months of streaming or exclusive content to be unlocked within Soundcloud. We tried building our own platform in 2015 for a while using the Seatgeek API which at the time already had profit sharing in place for referrals.