A significant architect behind SoundCloud’s ‘fan-powered royalties’ system is departing, in line with particulars shared with DMN. However the effort isn’t being deserted.
In the case of reinventing streaming royalty cost methods, SoundCloud has emerged as a frontrunner. Now, a significant participant behind SoundCloud’s heavily-watched shift in direction of fan-powered (or user-centric) royalty is stepping apart.
Michael Pelczynski confirmed to Digital Music Information that final week was his final at SoundCloud. Pelczynski served because the Vice President of Technique at SoundCloud, however discovered himself on the fallacious finish of the corporate’s substantial headcount reductions. After a five-and-a-half yr tenure, Pelczynski helped forge the royalty, financial, and industrial spine of SoundCloud’s shift right into a fan-focused royalty cost mannequin. In a nutshell, fan-powered royalties reward artists for the direct listening behaviors of followers, as a substitute of paying primarily based on fractions of broader, top-level subscription and promoting revenues.
“With a decent group of 5, I had the chance to architect and construct the business’s first to market user-centric streaming mannequin,” Pelczynski relayed. “The mannequin was not on any roadmap for years. We pushed on whatever the pushback as a result of we believed in it. We gained innovation awards for the mannequin.”
So the place is he headed now? Pelczynski says he’s contemplating the present state of the music business, and believes issues have reached a essential inflection level. “I’ve determined to have interaction it as a free agent, feeling elated and empowered to be advising and consulting the place I’m most wanted,” he provides.
With that in thoughts, Pelczynski says he’s establishing an company to supply his skillsets and vantage level to the business and to assist firms remedy issues in that wheelhouse. One of many conditions he hopes to handle? Constructing a brand new answer that forges consolidation amongst music tech’s rising fragmentation.
For the broader business, the query is whether or not SoundCloud stays a bull-charging proponent of fan-powered royalties. In response to Pelczynski, Ama Walton will proceed to guide licensing efforts, whereas John Atzberger can be taking the reins to handle the economics and technical evolution of the fan-powered royalty mannequin that Pelczynski helped set up. The remainder might required a while to shake out.
In the meantime, Pelczynski’s new company, Kinds + Shapes, goals to offer strategic recommendation and counsel to startups, established firms, institutional organizations, and rising artists alike.
Previous to becoming a member of SoundCloud, Pelczynski directed rights administration at Warner Music Group. He oversaw royalties and reporting throughout six label divisions, totaling greater than $440 million in annual income.