SoundCloud cofounders Eric Wahlforss and Alexander Ljung have created a platform with more than 38 million registered users. (Steffen Jänicke for Forbes)  January was a good month for SoundCloud.  Fresh off the launch of its redesigned site, the audio sharing company had seen registered numbers pass the 30 million mark. Engagement was reaching unprecedented levels, according to CEO and cofounder Alexander Ljung, as more and more artists–among them Destiny’s Child and The Strokes–moved to the platform to share their tracks with the world.  But not everyone was happy.  Shortly after SoundCloud unveiled its new site, which included sleeker media players and reposting features, disgruntled users began to chime in, ironically using the audio social platform as a sounding board for their gripes. Their biggest concern? That their beloved sound collaboration and sharing tool was putting “form over function” as its owners sought to make SoundCloud a more viable business proposition by attracting a wider audience. One user, British songwriter Peter Owen, went as far as to say in an audio post that the company was “doing a Zuckerberg,” a jab suggesting that SoundCloud was seeking out profits like Facebook Facebook has at the expense of its current user base (Owen’s original speech has been removed from his page.)  SoundCloud seems to see itself ”as the new Facebook in terms of their global ambitions,” says Owen, who began using the site in 2009. “Their main goal now seems to be to build it in preparation to either sell it or float it on the stock market.”  Therein lies the problem for startups hoping to scale: How do you maintain and attract new users and please investors without alienating early adopters? While Ljung remained mum on his company’s business plans when he spoke with FORBES back in January, he didn’t deny that SoundCloud was searching to broaden its influence. Now with 38 million users, the platform has users in almost every country around the world. It could hit 55 million users by year’s end as it registers 70,000 people a day. That’s quantifiable growth that goes a long way in justifying the company’s transformation, but at what cost to early adopters?  Those who feel alienated by the change point to the loss of community on a site that was once known for its ability to foster connections and collaborations among like-minded musicians and sound creators. Launched in 2008 from Berlin, SoundCloud became a fast favorite in German city’s electronic music scene, with cofounder Eric Wahlforss pushing it to local DJs as a grassroots means to share music. That ethos became the primary draw for early adapters like Owen, who called SoundCloud “classic” a “vibrant community” where you could get feedback from your peers. Not any more, say Owen and others, who believe that SoundCloud is shifting its dynamic to cater to listeners instead of creators, and thereby forgetting the individuals who populated the platform in its early days.  “They seem to be putting most of their energy into the big performers and providers,” wrote a commenter who identified himself as Peter Lehndorff on a FORBES print story.”[SoundCloud] isn’t what is used to be.”  For Owen and others disappointed by the change, complaints range from the alteration of the commenting feature (which is now too small, he says) to the disappearance of the Spotlight feature (which allowed some users to highlight certain work and audio tracks at the top of their profiles). Those frustrations have manifested themselves in the comments section of the company’s blog posts to product reviews, some of which have declared that the site is “optimized for listeners, not uploaders.”  Ljung says he’s listening. He admitted that the the platform isn’t 100% perfect and that the company released the new version of the site before it had completely translated old features. That led the Berlin-based startup to allow users to shift back to the old version for the time being. However, when asked about the negative feedback on the redesign, he suggests it’s a case of a vocal minority.  “There’s a huge amount of people that don’t speak explicitly what they think,” says the CEO. “But they speak a lot with their usage numbers. Companies usually see tremendous usage uplift. When Facebook introduced the newsfeed way back, it seemed like everybody was against it and yet usage went up like crazy.”  If numbers are any solace, Ljung can take comfort in SoundCloud’s massive upswing in usage. The company has more than tripled its user base since January 2012, when it had 10 million individuals registered. Since its redesign, average plays per user have gone from about 6,900 a month in December to more than 12,000 plays in March, according to digital music tracker Next Big Sound.  “It is possible that this is due to a shift in the artist population–that is, if our users have been simply adding more popular artists lately, thus shifting up the mean,” says Alec Zopf, an engineer at Next Big Sound. “But we definitely see a corresponding trajectory of the overall number of SoundCloud plays we track per month, so it’s likely that this is at least a fairly reasonable approximation of the network at large.”  Antwan André Patton, better known as rapper Big Boi, started using the platform two years ago and picked up his usage of his site recently to promote new album Vicious Lies And Dangerous Rumors that was released in December. Songs teased from that album have over 300,000 plays each on SoundCloud, a tool that protects creators from piracy while still allowing them to connect with their fans, says Patton.  “It’s a form of self-promotion,” he says.  That focus on publicity and play counts, however, misses this point for users like Owen and Lehndorff, who valued artist collaboration over all else.  “Most musicians are finding that the number of plays are up and the number of comments has fallen,” says Owen. “Those that haven’t left are starting to use the site differently. Now they’re using it just as an advertising space, somewhere to post the same track time and time again, instead of the collaboration and creative communication that was there before.”  “Now it’s fundamentally a music–and sound–streaming site,” he added. “That’s not evolution. It’s a change of species.”  Follow me on Twitter at @RMac18. Follow @RMac18
SoundCloud's growth and design changes have some wondering if the company is moving away from its roots and becoming more of an audio streaming site.