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Will SoundCloud Go burst the streaming music bubble?

Do we really need another streaming music service?


Nico Lang


The streaming music bubble may be ready to burst—and SoundCloud could be the needle that pops it. 

The German-based music company finally released its long-awaited streaming service, known as SoundCloud Go. Until recently, Soundcloud was primarily known as a site that artists and amateur musicians post original work, as well as remixes and mashups of their songs (often less than legally). Bloomberg once called the service the “YouTube of audio tracks, thanks to a huge library of free, exclusive remixes, b-sides, and DJ sets that pulled in far more listeners than Spotify, Apple Music, or Pandora.” 

Entering a crowded market, Soundcloud is emerging at a time when the industry has reached “too big to fail” status: In 2015, the digital music business was a nearly $6.9 billion empire, and streaming brought in 32 percent of that total. That’s a 28 percent increase from the previous year. If that trend continues, the streaming business will account for more than half of all industry revenue in two years.

The biggest question surrounding SoundCloud Go isn’t whether it will succeed. It’s whether anyone really needs another music service. 

The streaming industry has never been more successful, but there are already growing signs of its attrition, as firms struggle to make a footprint in an industry where the ground has been thoroughly stomped. The biggest question surrounding SoundCloud Go isn’t whether it will succeed. It’s whether anyone really needs another music service.

If it hopes to make its mark, Soundcloud certainly has a lot going for it. The platform, as Bloomberg suggests, already boasts huge user traffic, pulling in a reported 175 million pairs of ears each month. According to the company, Go’s library is just as massive as one would expect with 125 million songs in its catalog. Soundcloud comes supported with major licensing deals from companies like Sony but maintains its brand will stay thoroughly modern indie.

Despite those factors in its favor, the service is reportedly a disaster. In reviewing Go, critics did all but hang a noose for the nascent streaming platform. According to the Verge, its vaunted catalog is shockingly limited—missing acts as diverse and influential as Arcade Fire, The Beatles, The Black Eyed Peas, Grimes, Justin Bieber, Justin Timberlake, Katy Perry, Lady Gaga, One Direction, Radiohead, Rihanna, The White Stripes. And SoundCloud Go doesn’t have a single Kanye album in its library.

The most glaring flaw in SoundCloud’s algorithm is that Go doesn’t recognize albums, just individual singles. “There’s actually no such thing as an album inside SoundCloud Go,” the Verge’s Jacob Kastrenakes writes. “When I searched for The Strokes’ Room on Fire, I got 404 songs with ‘fire’ in the title rather than the 11 tracks that make up the album.”

Often finding a song you want to play at all is a Sisyphean task, even though that’s the one thing the service was designed to do.

The most glaring flaw in SoundCloud’s algorithm is that Go doesn’t recognize albums, just individual singles. 

There are almost no upsides to SoundCloud Go. For those already signed onto Spotify or Pandora, there’s nothing that Go offers that you don’t already have. And if you were already a dedicated SoundCloud listener, the new platform actually punishes you by walling off content you previously would have been able to get for free. That cool mashup of Taylor Swift and U2? You now have to pay $9.99 a month for it.

SoundCloud appears to be repeating a lot of the same mistakes as Tidal, the Jay Z-owned streaming company that is somehow bigger than ever and perpetually woebegone.

According to recent reports, Kanye West’s oft-retitled The Life of Pablo has been streamed 400 million times since its February 14 release. If each person who tuned into the album listened to it front to back, that means it would have been played more than 21 million times. For a reference, that’s even bigger than Adele’s record-breaking 25, which has pushed 19 million copies worldwide since dropping in November. If the numbers prove accurate, that means Kanye West bested her total in two and a half fewer months. Tidal even claims it was streamed 250 million times in its first week.

Some have, however, questioned those numbers—which seem too good to be true. After all, The Life of Pablo was famously pirated 500,000 times before it even came out, due to a botched release from Tidal executives. And if his album has somehow been streaming 400 million times, why does it feel as if no one is talking about it? For the biggest album in the world, it appears to be streaming in silence.

The conundrum that is Tidal is reflective of the music streaming industry itself: Simultaneously successful and quietly struggling at the same time. Launched last March in the face of widespread criticism of its star-studded ego bonanza of a release, the company is lightyears behind its competitors, considering that Apple Music launched later and has allegedly reached 15 million users already (although those potentially inflated reports have proven controversial).

If everyone is doing so well, why is everyone seemingly lying about how well they’re doing? Maybe because they aren’t. Forbes called the music industry’s veneer of success an “illusion of profitability,” with international revenue at its lowest point in decades. Most streaming firms have particularly struggled with profitability, and many will be forced to get out entirely.

Other industries have survived that inevitable oversaturation point, but music is a very different beast. 

In a damning report earlier this week, Billboard noted that Samsung’s Milk Music would be pulling out of Australia, as the market is wildly oversaturated. The relatively small country has a population of just 23 million, and there are just no more potential listeners left. In September, former iTunes executive Jackie Krajl predicted that would be the case. “Too many services, not enough people,” she told Billboard.

That seemingly isolated case, however, may be a bellwether for bigger issues in the industry. Billboard calls it a “canary in a coal mine” and warns: “Cutting one’s losses might be the future of digital music.”  

Other industries have survived that inevitable oversaturation point, but music is a very different beast.

For instance, you might have a Starbucks that’s located across from a Peet’s Coffee and Tea. These coffee chains can operate with relative success in close proximity because they are one-time services. When you buy a Tall Cafe Mocha, you are not agreeing to buy a Tall Cafe Mocha every single day until you cancel your subscription. You can go to Starbucks one day and Peet’s the next.

But if you were forced into a contract with your Starbucks, would you really need another chain? Or better yet, another location across the street?

The unsolvable riddle of the music streaming industry is how to convince people that they need something that they already have elsewhere. This is especially true when consumers already have so many options: Spotify, Apple Music, Rdio, Deezer, Amazon Music, Google Play, Rhapsody, and Tidal. What could SoundCloud Go possibly do that eight companies already aren’t?

The answer is: Not much. 

Nico Lang is a Meryl Streep enthusiast, critic, and essayist. You can read his work on Salon, Rolling Stone, and the Guardian. He’s also the author of “The Young People Who Traverse Dimensions” and the co-editor of the bestsellingBOYSanthology series. Follow him on Twitter @Nico_Lang.

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