With the music industry continuing to evolve, many have expressed frustration with Soundcloud and how the service has gone from a free sharing type website to more of a major and legitimate business that features content creators. With issues regarding whitelisting, or copyright takedowns being talked about by indie and even established artists, we have to say to everyone that we feel you should give Soundcloud a break and understand that a business that was focused on one thing, is shifting to focus on a nother.
Soundcloud is working very hard to continue to make their model more beneficial to content creators and we applaud them for their efforts as well as will continue to work with them to ensure that our clients better understand the service and its evolution.
It’s with this said that this article isn’t meant to bash or deny the efforts of our good friends over at Soundcloud, but to tell everyone about a new partner of ours that we feel quite passionate about and that may be an interesting alternative OR addition to your efforts on Soundcloud.
Symphonic recently integrated with a startup called Orfium and since then, we’ve seen their product evolve and continue to get better and better. We were able to catch up with the Founders, Chris Mohoney, and Drew Delis to discuss Orfium, their new website, and much more. This is quite a long read but one that we feel every content creator should check out.
Before reading, and before you forget, visit www.orfium.com to check out what they are all about!
Tell us a little bit about Orfium, what is it?
Orfium is a more intelligent and better organized music streaming / licensing platform that puts artists first in all of its policies which ensures they won’t have the same issues that plague platforms like SoundCloud. To put it more formally, Orfium’s mission is to provide an open, elegant, and flexible digital music platform that puts artists and rights holders in control of all forms of promotion, retail, licensing, and distribution, and to provide fans with the best discovery, sharing, and listening experience. Behind Orfium is a sort of special forces unit of experienced music professionals and software engineers who are familiar with the complexities of digital music rights. We are problem solvers aiming to create a win-win digital music solution that all music professionals and rightsholders will be happy with while also giving their fans an elegant listening interface. We are pretty confident in saying that Orfium has the best desktop user interface / experience among any music social network on the internet right now and while we haven’t yet released a mobile app, when we do I think we will be able to make the same claim about that as well.
What triggered you guys launching the brand?
The answer to this is actually quite lengthy so those with shorter attention spans might want to skim through this to the next question 🙂
Having already worked in the music business we had been watching from the sidelines the battles between the music industry, digital entrepreneurs, and tech giants. In one corner you have experienced music executives who have traditionally been resistant to technological evolutions they don’t fully understand. In another corner brilliant cyber cowboys who lack discipline in intellectual property rights. Then in another corner massive technology corporations with an appetite for increasing their stock price. Artists and their fans are left stuck in the middle of no man’s land as cannon fodder. We felt like the only possible sustainable solution to the problem would have to be simple to understand by all parties and would have to ensure that each party receives value in return proportional to the consideration they provide. We believed that such a solution was possible, at least for the constructive parties with reasonable expectations, and that if implemented with transparency those with unreasonable expectations would eventually become exposed and people would avoid them. Consumers want good music, music professionals want to get paid, aspiring professionals want to be heard, technologists want to accelerate access to music, and none of these are incompatible.
What started as a conversation between Orfium’s co-founders and musician friends who were frustrated with the current situation led to many different overlapping ideas and eventually the idea for Orfium came into focus. Drew and I met and became friends attending and graduating from the University of San Diego together. After I finished my masters in accounting I went on to work for a music licensing and rights management business while Drew went on to law school. I held dual roles as head of product and head of accounting managing six million music copyrights in YouTube’s Content ID system along with a sync-licensing library of over 400,000 audio files. YouTube’s Content ID system works by creating a digital fingerprint of music which is scanned against videos and when a containing the music is detected advertisements would appear around the video (if they weren’t already running) and the rights to the revenue stream from those ads are assigned to the music rightsholder. The uploader would still get to keep the video up for free while the rightsholder collects money making both parties happy. I found this to be a very elegant solution to copyright issues in user generated content and in particular felt like the concept of abstracting monetization rights from a digital asset and assigning it to the original rightsholder had a much wider application especially for remixes and derivative works. Further, if revenue could be generated not just from advertisements, but also from streaming and digital downloads, then significantly more value could be generated for rights holders which most would certainly prefer over issuing mass takedowns that pay nothing. Meanwhile Drew was in law school doing specialized studies in intellectual property related to music and entertainment rights as well as digital and internet copyrights.
When I had reached a point where I wasn’t learning anything new at my previous job the owners were preparing the sell the company and I felt like it was a good time to move on so I jumped into starting Orfium full-time. Given the complexity of the back-end system required for Orfium I knew I had to refine my understanding of software engineering in order to communicate its needs with sufficient precision to other developers. Luckily I had actually started out studying computer engineering before switching to accounting and already had a fair amount of programming experience. I started at MIT’s course listing and made a list of textbooks and then went to Amazon and bought all the books with the best reviews and set out to create the prototype of Orfium in my apartment. Drew meanwhile was finishing up his final year of law school and working with legal counsel on all of the legal documents for Orfium. Today we have a team of four brilliant engineers who are also each working on a Ph.D. at the University of Athens along with some outside consultants helping with marketing and growth. We couldn’t be happier with what we’ve been able to do so far with such limited resources and I think it goes to show that the mind really is the most powerful resource of all.
Would you say you are like Soundcloud or not? What are some differentiating factors?
This also requires a lengthy answer however I think this info is very important to to pay attention to:
First let me start of by saying that I have tremendous respect for SoundCloud because what they built was no simple feat. Everyone is aware of the problems SoundCloud has been having so I don’t think it is necessary to go into detail about those but I do believe there is a common cause to all of their issues. SoundCloud was originally not designed to be a music platform, it was actually a sort of sound database, in fact I believe there mission initially was to become the largest database of sounds. The problem with this is that they didn’t have the proper back-end architecture and capture the music metadata necessary to properly monetize music and manage music rights. Music rights are very complex and just to know how to even build a proper system requires specialized cross-disciplinary experience in both the music business and software engineering. By the time they became popular as a music platform their database was huge and it was too late to easily fix the problem. This is why I believe SoundCloud Go had to be built on top of their existing system rather than seamlessly integrated. Combine that with inexperience in the realm of music rights while trying to fight lawsuits and keep their numerous employees fed and investors happy it becomes a very difficult beast to manage. At this point to really make their platform optimized for music they probably need to start over development from scratch and begin by laying the proper foundation, however I’m not sure that their investors have the patience for such an undertaking.
Orfium is similar to SoundCloud in many ways but also has many significant differences. At the moment we have all of the most useful functionality that SoundCloud has so if everyone migrated their music from SoundCloud to Orfium I don’t think they would miss anything and would have fewer headaches as well. Like SoundCloud artists can directly upload their music, promote themselves via a public profile, and fans can follow artists and receive a feed of their content and share it. We will also be adding private upload functionality and integrating that with the messaging system in the near future. However this is where the similarity between Orfium and SoundCloud ends. Unlike SoundCloud, it is free to upload and host on Orfium and access all of the features that SoundCloud arbitrarily restricts to Pro Account users. At Orfium we highly value the music and feel that it is the music itself that is the source of value that causes visitors to come, not the other way around. We don’t think it is fair to ask for payment from someone who is providing content. We also would never charge for services that have little marginal cost to provide such as “premium features” because once they are built the software works automatically and it doesn’t really cost us much for each additional user. Sure there is the up-front cost to develop them which may cost thousands of dollars but when you allocate that cost among many users it really costs pennies per user and being a five star service provider we see these as complimentary amenities that we ought to provide. Our philosophy towards business in general is that profits are only deserved in return for solving someone’s problem and they are deserved in proportion to the labor and quality of the solution provided.
Compared to SoundCloud, Orfium’s monetization platform is much more powerful as it includes licensing options and is open and integrated in a single upload process for all music. In other words, there is no need to be part of a special club in order to monetize on Orfium, all artists have to do is verify their account. Our philosophy at Orfium is that artists should not have any legal or financial risk in using Orfium, meaning that they can opt-in/out of individual services on per-track basis at any time and Orfium operates on a pure revenue share so Orfium does not get paid unless artists do. Because Orfium is so flexible anybody can customize the service to their needs and carve out services for which they already have deals with 3rd parties. Independent artists who self-upload get to keep 80% of the revenue they generate and get paid directly without any middle man. However they can also upload their music through a digital distributor which is a great way for them to conveniently get their music on many other music platforms as well. Record labels likewise can also create accounts to upload and promote on behalf of their artists. Because it is possible for a distributor to upload music by an artist who is not yet on the platform we are working on a simple way for artists to claim and manage the profiles the distributors have created for them, and I can promise along with everything else we do that it will be done elegantly when complete.
Orfium’s consumer interface is also much easier to use than SoundCloud’s and works in many ways like Spotify or iTunes. It is very easy for users to manage their saved music and purchases as they can access it along with their playlists and albums in one click. Our aim was to give users the same functionality provided by a desktop media player for passive listening. The search engine is also much more powerful than SoundCloud as it is structured for music which allows searching by genre, subgenre, mood, instruments, vocals, and licenses. Most consumers will probably stick to genres, subgenres and moods, while licensing customers will probably find the other filters helpful when searching for the perfect track to license for a creative project.
Another feature we feel will become very important in the future is our events platform. Events have become the most significant revenue source for many artists and no music platform would be complete without this support. It works similar to a Facebook event except that it is structured for concerts. The entire lineup of performers are tagged in the event page with play buttons to sample their music and links to their profiles. All important information about the event is contained in the info section such as where to buy tickets, the event’s website, and a Google Maps object with the location. This feature is still in its infant stages and we are just waiting to get feedback from users to see how we can improve it but we believe it has a lot of potential to offer to artists and event companies. There are also a number of other small features such as the ability to tag multiple artists who collaborated in a single song so there is no need to duplicate the upload or repost it in order for it to show on both artist’s profiles.
Will people expect a lot of copyright related issues like what they see on Soundcloud?
Although not perfect, I think YouTube really paved the way for creating an elegant model for dealing with music copyrights in user generated content. Our strategy for managing copyright related issues, in particular unauthorized remixes and derivative works, is to simply assign the rights to monetize the content to the original rightsholder in return for allowing the content to remain on the site. Of course it is ultimately up to the original rightsholder whether they want to monetize or issue a takedown. However in my experience with YouTube rightsholders almost always chose to monetize which I believe is a win-win situation because it allows the uploader to generate free exposure while allowing the rightsholder to be compensated. Also since we do tag remixes alongside the original tracks as recommendations on the track pages, it also creates an opportunity for the rightsholder to generate more traffic to the original song via the remixes. In the case of cover songs, if the entire recording is completely re-performed, meaning that the instrumental was actually re-recorded rather than merely singing over the original recording instrumental, then the cover artist would only need to purchase a compulsory license at the legal mandated rate in order to retain monetization rights.
How can someone make money with Orfium?
One of our goals at Orfium is to make every digital revenue stream possible available to uploaders integrated in a single upload gateway. So far we have rolled out digital download and sync licensing sales, however uploaders will notice in the monetization section of the upload form a number of other options which they can pre-emptively opt-into so they can start earning money from them as soon as they are rolled out.
The revenue sources are divided into four major categories, 1) Retail, 2) Licensing, 3) Onsite Rights Management, 4) Offsite Rights Management
Retail currently includes digital downloads and we will implement radio and streaming subscriptions in the future once we have enough content on the site to be on par with other consumer subscription offerings. We also plan to offer distribution so uploaders can have their music pushed to other retail platforms.
Licensing currently includes sync-licensing and the future we will also offer publishing administration services and subscription broadcast services. The difference between publishing administration services and traditional publishing services is that we don’t take ownership of any copyrights, we would act more as an agent or broker sourcing deals with tv / film studios and advertising agencies. Subscription broadcast services will allow artists to have their music available to subscription broadcasters such as physical retail stores, bars and coffee shops that want to stream music for their patrons.
Onsite Rights Management essentially includes services that allow artists to monetize remixes, DJ sets, and podcast episodes in which their music is used on Orfium. Offsite Rights Management services includes the same except to do it on other platforms such as YouTube, Facebook, and Amazon Video Direct. In addition we also plan to offer services to make it more convenient for artists to collect from PROs, SoundExchange, Harry Fox Agency, and related entities that owe them royalties.
You guys also offer royalty free music, how does that work?
We support all of the major creative commons licenses and we also allow artists to sell paid micro-licenses (sync licenses). The way our sync licenses work that is different from other platforms is that rather than over-complicating the licenses by enumerating all the different possible obscure use cases, we simply base the licenses on the dollar amount of the production budget and lifetime revenue of the creative project in which the licenses will be used. Artists can set their own prices but the default price for the standard license is $30 and allows for use in projects with production budgets and lifetime revenues of $2,000 or less. The extended licenses has a default price of $150 and increases the thresholds to $10,000. The premium license has a default price of $500 and increases the thresholds to $50,000. For any larger project the buyer would be directed to contact the artist/songwriter’s publisher. This guarantees that the artist will get paid no less than 1% of the production budget and lifetime revenue of the project in which the song is used and also ensures that it won’t conflict with bigger publishing opportunities since most publishers wouldn’t waste their time negotiating deals of this size. Also in the case where the project is a musical work the thresholds are reduced to guarantee the artist will get paid no less than 25% of the production budget or revenue generated by the project. These are smaller deals but because they can be automated there is very volume potential of deals. We think these licenses will be especially of interest to YouTube creators who want to license background music for their videos. Also no other licensing platform has this integrated in a consumer facing interface and we think by doing so it will bring a lot of awareness to the existence of these licenses to people who otherwise wouldn’t know how to legally use music in the background of a video or other creative work.
You’ve just launched a new version of your site, why should people go and check it out?
First because it is beautiful and there really isn’t anything quite like it out there. It’s the perfect integration between the best social features of SoundCloud and consumer discovery and listening features of Spotify. Second, for those who tested the beta, the new version is a remarkable improvement which I think says a lot about the fact that we are listening to people’s needs and will continue to listen because that’s the only real way to make progress and find solutions. We even had a few cases where users wrote into our support desk requesting some simple feature that made so much sense we had it implemented within 24 hours. You won’t get that type of service with other platforms. Certainly early users will also benefit from getting their music in our recommendation algorithms early which will give them access to a whole new audience. I think this is especially important because the way SoundCloud Go was implemented has drowned out independent artists in favor of the established artists. Most importantly people should check out Orfium because we are trying to build a better music platform for them but we can’t do it alone and we need their help. We need artists to test it out, provide their feedback, collaborate, and spread the word so we can all come together and build the greatest music community.
What is next for the brand? Or better say, what new features that musicians can take advantage of?
Since we made so many new changes to the site it’s likely we are going to find some bugs that slipped through testing. There are just so many different browsers, devices, and operating systems out there that it’s impossible to really test them all. We’ll continue to monitor the site and fix anything that comes up for the next couple weeks. Meanwhile we will also be working to enhance the mobile experience. After that I’d say the biggest features we still have left to do for the front end is podcast and DJ set support and an online radio. A lot of the work we believe we will be doing for the next twelve months will be on back end features, management tools, analytics, and of course turning on all of the other monetization services we have planned. I think Artists should take advantage of all of the search engine tags available such as moods and alternate categories and subcategories as it will help their music get discovered more easily and indexed in Google search as well. Also it would be great to see the events feature get utilized. I would consider our support inbox to be one of the most valuable features since we are eager to hear user feedback on what we can do to improve the site. Most importantly musicians should have fun with it, makes some friends, engage with other users, curate playlists, and enjoy the music!