Written by Jefferson Graham — Struggling music service Soundcloud is introducing a new, $4.99 version of its music subscription offering, hoping the lower price will entice more folks to sign up.
The mid-tier service, SoundCloud Go, offers 120 million songs, no ads and the ability to listen offline. The original, higher priced service, SoundCloud Go Plus, is $9.99, and has 150 million songs to listen to.
SoundCloud co-founder Alex Ljung says the difference between the music selection on both services is "nuanced." Some artists, like Chance the Rapper, don't mind being on both tiers, while signer Adele is only available on the more expensive service.
"The way to think about Plus, is it’s the ultimate music sub package," says Ljung, "with 150 million tracks, much more than any other service."
Many of the songs on SoundCloud are submitted by musicians themselves, with first takes on their tunes, remixes and the like.
Apple Music says it has 40 million songs in its library, to 30 million songs on Spotify. Apple Music has 20 million paying subscribers to 40 million for Spotify. SoundCloud launched Go in March, but Ljung declined to offer numbers, beyond that SoundCloud has 175 million registered users.
Meanwhile, Ljung addressed January headlines that suggested SoundCloud could run out of cash this year and potentially be forced to shut down. "We’re not closing down this year," he said. "Absolutely not."
The stories stemmed from a statement to British regulators that “risks and uncertainties may cause the company to run out of cash," based on 2015's loss of $63 million (US equivalent to 51 million pounds.) The company is headquartered in Berlin, but is a legal entity in the United Kingdom.
Ljung said these are older numbers, and "we're not profitable. This isn't a surprise." He said SoundCloud was doing what many tech firms do—try to get a big user base first, and then bring in monetization.
"In 2016 our revenues grew rapidly--we'll see a 2.5X increase," he says. "The music streaming market is growing at an incredible pace."
There have been reports that SoundCloud was up for sale, but rebuffed by Spotify and Twitter. Ljung said the company isn't for sale. "We're looking to build a massive, strong, independent service," he said.
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