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Simon Canning, Mumbrella Thursday, Sep 15, 2016 1:20 PM EST

Soundcloud Opens Platform to Australian Advertisers as Premium Offer Goes Live

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The battle for the music streaming advertising dollar got more intense overnight after Soundcloud opened its platform to local advertising on the back of the launch of a premium subscription service.

The German-based streaming service which has long promoted itself as the artist’s platform of choice, hosting music and podcasts, will recruit an Australian sales team to support the site locally and manage brand partnerships.

Soundcloud has also moved from a free model to a dual approach of free and subscription service like rivals Spotify, with the free model now supported by brands.

Soundcloud Go, which launched in Europe and the US earlier this year, has been launched in Australia, offering users access to licensed music advertising free.

The platform has hosted advertising on its US site for the past two years, using revenue to pay artists who share their work on the
platform. 

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Sonia Flynn, vice president of international for Soundcloud, said the company would partner with Adswizz and Triton Digital to deliver interstitials and audio ads to help support musicians sharing their music on the site.

“The introduction of advertising forms a cornerstone of our commitment to the interest of our creator community, 12 million of which are heard each month on our platform,” Flynn said.

The premium Soundcloud Go service will cost subscribers $11.99 monthly, in line with what rivals Spotify and Apple Music charge.

Flynn said the local advertising offer would begin with programmatic while the sales team was being recruited, before Soundcloud began offering bespoke solutions to advertisers.

Australia is the first market outside the US, UK, France and Ireland to get the new model.

“For lots of good reasons we decided Australia and New Zealand made sense in terms of being the next places we went to market,” Flynn said.

“(Overseas) we have seen good momentum, just to name a couple of the brands that we have been working with so far, they include Red Bull, Netflix, Sonos . We are seeing really interesting reactions and responses from brands who are really excited to work with us and I think it’s largely because of the scale of the audience that we offer.”

Figures released by Comscore in February revealed Spotify had 2.985m users in Australia, ahead of 2.059m for Soundcloud, 976,000 for Pandora, 484,000 for TuneIn Radio and 468,000 for iHeartRadio.

Soundcloud boasts 175 million people globally and is playing on the strong relationships it has directly with artists, the diversity of its content and the desire of agencies and brands to its diverse audience as drivers of the advertising funded model.

“We have opportunities for brands to talk to our audience in-stream, so a brand can talk to our audience via a promoted track or a promoted playlist and (the audience) be directed to them in-stream which is a really interesting opportunity.”

Soundcloud will also offer sponsorships where brands will be partnered with emerging artists releasing new material.

Flynn said the decision to introduce the premium Soundcloud Go to Australia was about offering its users more choice as to how they were able to access content.

While artists using Soundcloud could lock their content into a 30 second sample on the free version, Soundcloud’s full catalogue of 135 million tracks would be available to stream and download for Go subscribers.

“Within that there is also a massive amount of diversity, so we have established artists and emerging artists and they sit side-by-side and that is different and unique to our platform,” she said.