It's the biggest thing since sliced bread (or at least Reggae Reggae Sauce) for internet-savvy musicians. Allowing you to upload songs, embed snazzy little flash widgets and share music with other artists and fans in a clean, richly creative environment for free. Not too shabby - but some of the greatest uses of the soundcloud framework are still being discovered. Take a look at a few of them...
Community-based music creation
Have you ever shown a song to your friends and found out that there's one bit they all don't like, or something they think you should have done more? Well a clever use of soundcloud is to upload iterations of your work. Allow the Works in Progress of your tunes to be streamable so your audience can take part.
Your fans can suggest new ideas, warn you from making mistakes, even help you improve your production techniques if they themselves are technically inclined. Then you can continue to upload new versions until you are happy with the final result - having created it with help from all of your online amigos!
Find some artists on there that you like and get involved in their process. Give them ideas and suggestions enough and they'll be intrigued enough to check you out. Especially if you say something like "You might want to try this technique I used in my song 'Cyber Awesome Death Face'".
Whether or not you pick the first 4 words that come into your mind to name your tunes, this could result in collaborations, new fans and new friends from your promotional activities. The best way to get an active audience is to interact with it!
Creative Commons
Thanks to the creative commons license, you can use the power of giving your music away for free to get it all over the internet. Creative Commons licenses allow YouTube users to use your tunes on videos that could become viral hits.
They allow your tunes to be exposed to a massive audience and there will inevitably be people asking "Who made the music for this??!?!??" (With that many question marks). You can happily point them towards your soundcloud for an answer, or perhaps the video's creator will do so for you since I'm sure they'd be happy to add a little link in the description to your page.
Blogs and podcasts are also going to be happy to listen to your tunes, promoting them if they find themselves enjoying what they hear. That's when those widgets really come in handy!
So there are a few methods of utilizing the cloud to distribute your sound! Think about it enough and maybe you can think of some other methods of making the most out of some of the awesome websites out there!

