Official Response
Hey, this is Jami from SoundCloud. I work on the Creators team.
This was a tough decision for us. We tried a few times to improve Groups, but struggled with the way it was originally built, and often had to prioritize other features over Groups (we’re still quite a small team!).
In all honesty, Groups don’t perform well as we’ve not been able to invest in them. They were designed at a time when SoundCloud was much smaller, but now that the platform is used by more people they’re straining under the load, and often cause platform-wide instability.
Over the last few years, we’ve invested in enabling listeners and curators to share the music that they discover and love, and recommendation tools that help unearth music from both established and lesser-known creators - all of which have helped amplify creators further - but there is a clear gap for artists who are getting started, and are trying to get their music out there. We’re aware of this gap, and are exploring ways to help creators find their community and share their tracks, without listeners and curators becoming overwhelmed with incoming tracks.
Unfortunately, we haven’t been able to fill this gap fast enough, and maintaining Groups in their current state is making it harder for us to invest in new tools better suited to SoundCloud today.
We’ve seen some success with creators sharing their tracks to people they think will like them via messages, but know that the lack of messages on mobile also limits this.
It's hard to stop working on something in order to avoid spreading ourselves too thinly, especially when a lot of people really like this feature. I hope this provides a bit more background to the decision, and doesn't hurt your ability to connect with like-minded musicians and share your tracks too much.
We're taking all your feedback into account, and I hope we can find a way to improve upon things soon.