Soundcloud + User Centric Payments

Soundcloud recently announced Fan Powered Royalties - a different approach to paying out artists than what any of the other streaming services use. I've been fascinated with this approach ever since I read about Deezer's User Centric Payment System. This article does a good job of explaining "pro-rata" payouts vs "user-centric" payouts but the gist of it - instead of paying artists with the most repeated plays on a given platform, payouts are based on direct plays from subscribers.

Maybe I'm oversimplifying it or misunderstanding the approach but, as far as I can tell, they're going to try and pay out artists based on actual plays; not an algorithm of who should be paid. This is closing in on 1:1 plays to payments.

The Soundcloud promo site sells it pretty well but there's a lot of documents to sort through to figure out how to be eligible for it. To start, if you're on Soundcloud and don't have ISRC codes on your tracks, you should go ahead and do that ASAP.

However it shakes out, it's a very worthwhile experiment and I'm happy to see a big company like Soundcloud trying this out.