SoundTwitter? Report suggest Twitter is considering buying SoundCloud

Re/Code’s Peter Kafka just broke a story that - if true - could shape the conversation around streaming services for the rest of the year. He reports that Twitter is considering acquiring SoundCloud, although he stresses this is not in any way a done deal.

SoundCloud is a company that seems ripe for acquisition, it has done amazingly well on its own but it feels like in order to achieve true "world domination" as a platform it may need the backing of an entity large enough to shoulder the costs of the necessary licensing deals and could provide it with a developed and sophisticated advertising network.

VCs - who have already poured over $120 million of funding into the company - may be looking for an exit as some of them have been invested since its Series A in 2009. Spotify has recently closed a $250 million round, Deezer closed a $130 million round in 2012 and may well be needing to raise another soon, so if SoundCloud was to fly solo in becoming a fully legal service it would need to raise considerably more cash.

Twitter on the other side has always been a company interested in music. Its most followed accounts are artists and after the debacle that was its music app the company may look for a more robust way of expanding its music cachet. For Twitter pouring a couple hundred million of investment on top of the purchase price may not be such a big deal, which would catapult SoundCloud into the major league of the streaming race very quickly.

If the acquisition was to happen it could well be SoundCloud’s YouTube moment. SoundCloud’s CEO Alexander Ljung has often compared the company to the YouTube of audio. YouTube would not have gotten anywhere near where it is now had it not been for the acquisition by Google which allowed the company shelter from legal storms, access to a huge advertising network and the cash to close deals with rights owners.

For now of course there’s nothing concrete to go on - not even a potential sale price - but now that the rumour’s out things could start moving a little faster.

(Andrea Leonelli)