Twitter Considered Buying German Music Service

By Yoree Koh and Chase Gummer witter Inc. considered buying German music-streaming service SoundCloud Ltd., but it has backed out of the talks, according to a person familiar with the matter. The short-messaging service chose to let the deadline for exclusivity on talks pass without coming to an agreement because “the numbers didn’t add up,” the person said, without offering specifics. It is unclear which party initiated the talks. SoundCloud, a free site that lets people upload and share audio files, would have been Twitter’s biggest purchase to date as the messaging service seeks ways to stem a slowdown in user growth and diversify its revenue streams. Earlier this year, Berlin-based SoundCloud raised $60 million in venture-capital funding at a valuation of about $700 million. Twitter’s largest deal to date is a $350 million purchase of mobile ad network MoPub in October. SoundCloud, with more than 250 million users—roughly comparable to Twitter’s user base—is a popular way for DJs and musicians to promote their own music. It also offers a subscription-based professional account for musicians to publish their own music and mixes. The two companies originally teamed up in 2012 to let users listen, like and share songs from SoundCloud without leaving Twitter. Twitter then launched its own app in April 2013 with music-streaming partners Spotify AB, Rdio and Apple Inc.’s iTunes to help users find music that is popular on Twitter and discover music based on the accounts they follow. The app failed to resonate with users, and in March Twitter pulled it. Twitter recently began trying to forge a partnership with Beats Music that would promote subscriptions to the music-streaming service, according to a person familiar with the talks. Beats Electronics LLC, the high-end headphone maker that recently launched Beats Music, is in talks to be acquired by Apple for $3.2 billion, people familiar with the matter have said. One cause of concern for SoundCloud is its lack of licensing agreements with music labels that permits them to stream copyright material. While professional musicians including Nine Inch Nails and Beyoncé have debuted exclusive content on the service, most of the tracks are from amateur musicians. Read the full article here:

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