Warner Music has signed a deal to licence their music to SoundCloud, making them the first of the three major record labels to take up the offer of shared equity made by the streaming service earlier in the year.
SoundCloud will pay royalties to Warner Music and publishing arm Warner/Chappell–both the third largest label and music publisher respectively–whenever one of their songs is streamed on SoundCloud’s free, ad-supported service. In addition, SoundCloud will also offer a paid-subscription service, due to launch in 2015.
SoundCloud already has a paid service for uploaders, but users can still find their material removed without notice, largely due to automatic takedowns of copyrighted material. The introduction of a paid service, along with ad support, will provide an income to copyright owners, while also allowing users to upload mixes and mashups without their material being deleted. It seems like a fair solution for all involved, but it remains to be seen whether the other majors and the ever growing indie label market will follow suit.