UPDATE: SoundCloud has since provided the following statement to The Verge…
“SoundCloud is the leading platform for audio creators, dedicated to empowering them with the best tools and services to grow their careers. The SoundCloud Premier monetization program operates on a fixed net revenue share of 55% and monthly royalty payments paid net 45 days to creators, which exceeds most other platforms. SoundCloud Premier is completely non-exclusive, the creator always retains all their content rights, and reserves the right to exit the agreement at any time. We are always looking for ways to simplify our agreements for the benefit of our creator community, and will take the opportunity here to avoid future confusion.”
Writer Dani Deahl says parts are “completely false.” She says, “Original reporting stands — the Premier contract is bad for artists looking to self-monetize.”
SoundCloud recently rolled out a new track monetization feature for independent creators — but users should be wary of the terms and conditions attached to the deal.
The Verge dug up said terms and conditions and received feedback from industry professionals. Across the board, they found the contract to be more favorable to the platform than the artists. While SoundCloud does offer a means for musicians to get paid for their work, it could be an unfair deal for the artists who get involved with the monetization program.
“This agreement,” media attorney Jeff Becker says, “will allow artists to monetize the exploitation of their music on SoundCloud only if the artist agrees to forego all existing claims he or she may have against the company.”
Not only does the fine print make it impossible to sue SoundCloud and difficult to challenge pay statements, the platform has the power to switch up terms on payout without any negotiation.
The flexible percentages spell out a startling worst-case scenario for artists…
“SoundCloud can say, hey we might change this and we don’t have to give you notice other than just posting it on the service,” explains artist manager Josh Kaplan. “Not even an email. You could just wake up and they could say, actually now the share is 25 percent. And if you didn’t check in online on your SoundCloud [account] you would have no way of knowing. How would you know to opt out, until you got a statement? And you don’t know when you’re getting [the statement] because they’re ambiguous about that.”
As the contract is thoroughly dissected, there are more and more red flags that pop up. SoundCloud monetization might not be a bad thing for independent creators, but signing these terms and conditions also doesn’t seem to be in any given artist’s best interests.
SoundCloud Premier Monetization Terms and Conditions
Source: The Verge