The streaming service makes a significant breakthrough in its attempt to go legit.
As Music Business Worldwide reports, “watertight sources” have said that the deal will see Sony Music receive shares in SoundCloud as well as in invitation to participate in the company’s next funding round.
Despite have reached agreements with Universal Music Group and Warner Music Group, SoundCloud’s lack of a deal with Sony Music has made it difficult for the streaming platform to launch a paid subscription service.
The deal with Sony Music should also reduce the spate of takedowns and profile deletions that have plagued SoundCloud over the past year.
The agreement means the platform is now able to stream music from Sony Music artists including Beyoncé, The Weeknd, Justin Timberlake and Michael Jackson. It marks a change of heart for the label, which last year removed recordings from many of its artists citing “a lack of monetisation opportunities on the platform.”
Despite amassing a huge user base, SoundCloud has struggled to reach profitability since launching in 2007. Last month it was reported that the company suffered losses of $44m in 2014.
FACT has contacted SoundCloud for comment.
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