SoundCloud, an online audio distribution platform based in Berlin, Germany, is going to shut down its services by the end of this year. This is not a good news for those who have associated with the company in recent years. We recommend such clients to save their playlists now to avoid any awkward situation in coming days.
The source of our claim lies in the recent moves from the SoundCloud as the co-founder Alex Ljun announced last week that his company will be laying off 40% of its staff (almost 173 employees). Moreover, SoundCloud offices in San Francisco and London will also be shut down, while their main offices in Berlin and New York will remain open.
2017 – A Tough Year for SoundCloud
The year 2017 has not been a kind year for SoundCloud, as statements from their founders came in that they might not have enough money to even see it through the year.
According to a report by TechCrunch, SoundCloud might not even have enough funding to last them during the summers. In an interview with them, Alex Ljung shut down claims that SoundCloud is facing some difficult times. He instead insisted that closing down offices in both San Francisco and London will help rein in their expenses, and that SoundCloud will be able to take over control.
To make matters worse, a video surfaced online, showing SoundCloud founders Alex and Eric Wahlforss telling the remaining staff that the company only has enough funding to last till Q4 of 2017.
Soon after that video went online, SoundCloud issued a statement that they were actually “fully funded into Q4” and that it was also in talks with potential investors.
The Problem Area
Experts say that SoundCloud never managed to figure out how to earn money from its users. Having a lot of following and support is good but in the end it all comes down to money. In this respect, SoundCloud just couldn’t catch up with other competing premium services such as Spotify.
Although SoundCloud is a free service for the most part, they also launched a paid service called SoundCloud Go which allows artists to get paid, making the app ad-free and also offer offline music playback.
Let us see how long SoundCloud will manage to stay on surface. Even though the subscribers are advised to save their playlists for future use.