SoundCloud and Sony/ATV Announce Licensing Deal in Europe

SoundCloud, the user-driven streaming platform which recently announced a paid tier of its service, and Sony/ATV, the world's largest music publishing company by market share, have announced a "multi-territory agreement for Europe" around the publisher's vast catalog.

The deal will allow Sony/ATV's catalog to generate money for its songwriters via SoundCloud's bleeding-edge identification technology.

 “These deals for the US and Europe create the best opportunity for Sony/ATV and its songwriters to maximize the creative and revenue benefits of SoundCloud’s multi-territory business," wrote Sony/ATV CEO Martin Bandier in a statement on the news.

"Our agreements with major partners are a significant part of achieving our ambition of allowing all forms of creative expression to live on our platform, while simultaneously ensuring rightsholders’ work is rewarded and respected," said Alex Ljung, SoundCloud co-founder and CEO.

Both Sony/ATV and SoundCloud have had an eventful year so far. In March, the publisher announced it would buy out the 50 percent stake in the company held by Michael Jackson's estate stake in the company for $750 million. 

Two weeks later, SoundCloud announced the debut of its long-gestating streaming service, Go. The service's launch was made possible after the company struck a deal with Sony/ATV's major label corporate sibling, Sony Music, which had been aggressively negotiating with SoundCloud on a licensing deal through much of last year.

Go is a markedly different beast than products like Spotify, Google Play and Apple Music. SoundCloud has long been a home for user-generated material -- i.e. DJ mixes, remixes and work that features heavy use of sampling, also called "derivative works" -- creative work which was difficult for SoundCloud to monetize legitimately due to the technological complexity of identifying those myriad snippets of others' work, as well as the relative proportion of that sampled work in an overall piece. With Go, SoundCloud claims to have solved that problem. (Questions on how subscriber fees and advertising against those user-generated uploads work in a granular way, for instance if a user-uploaded piece of work was 80 percent original work and 20 percent sample-based, who is paid what -- to which SoundCloud responded it wants "all creators" to be paid on its platform, without specifying a more granular pay split.)