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Rumor Fact(ory): SoundCloud nearing a deal with Universal?

soundcloud-logo 200wWe’ve been hearing whispers about SoundCloud and its outlook for months, with people across the industry questioning whether the audio platform is hovering on the brink of glory or disaster. The latest hints point to positive news, as rumors circulate that it is on the cusp of agreeing to a licensing deal with longtime critic Universal Music Group.

According to Music Business Worldwide, Universal wants more than the 5% equity that Warner took in its deal with SoundCloud. “Universal had a couple of aggressive choices: they could either sue SoundCloud, which wasn’t off the table, or refuse to play ball with them and watch them slide out of existence as money ran low,” sources told MBW. “Initially, UMG’s demands were completely unacceptable to SoundCloud, but the balance of power – of who needs who to prosper – appears to have shifted since those days.”

Universal’s Lucian Grainge was just in the news yesterday with his latest opinions about the role freemium can and should play in the music field. With any potential deal still in negotation, we won’t know who got their way until a formal announcement hits.

Also, even if SoundCloud is at the point of accord with UMG, it still has to overcome the hurdle of Sony. That major label has been militant with pursuing takedowns on the platform, a hardline enough stance that even some Sony artists are frustrated with the outcomes. One of the latest artists caught up in the crossfire was from DJ outfit Jakk’d, who penned an angry post critiquing SoundCloud after their profile was removed, accusing the company of being “dead broke, and lost touch with why they created the site in the first place.”

If there’s anything we can take from the ongoing back and forth centered on SoundCloud, it’s that finding a solution that will make all parties happy is possible. The jury’s still out on whether it’s likely.

Anna Washenko

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