Twitter may be looking to boost its user growth and revive its previously failed music streaming efforts by purchasing SoundCloud.
Re/code reports that, “… according to people familiar with both companies,” Twitter is considering a deal to buy the Berlin-based audio streaming platform recently valued at $700 million. Neither company has yet confirmed the report, however.
Twitter took a shot at a standalone music streaming app in 2013 with Twitter #Music, which was removed from the app store and shut down in April 2014.
SoundCloud has served as a YouTube-style platform for music and even satisfies the need for a conventional record label for many of its 250 million users since its founding in 2007. With similar user figures, Twitter would benefit from broadening its reach using a different platform despite some existing overlap, and SoundCloud is already the most commonly linked music streaming service on Twitter.
Likewise, such a deal would appeal to SoundCloud for the added user base in addition to the monetization opportunities made available by joining Twitter. The two companies have considered limited partnerships in the past, like when Twitter #Music was being conceived, and they share a major investor or two already, so they know each other well. Buying SoundCloud seems like a logical move, but as mentioned, it won’t come cheap, and both will likely deal with users concerned for the integrity of the platform and its continued free status, as was the case with Facebook’s acquisition of Instagram.
Read Re/code‘s report and analysis here.