Twitter is reportedly considering a deal to acquire SoundCloud, the German-based audio service that provides a platform for sharing and uploading audio files. As of October 2013, they have 250 million users, even more than Twitter's stated number of "active" users.
This would be Twitter's second attempt at integrating music into the 140-character-or-less experience. This March, Twitter removed the "Twitter Music" from stores, which was a standalone app that basically no one used. Because SoundCloud already has a built in user base, it could be a more seamless integration.
The deal could also offer SoundCloud access to major ad sales. Currently, SoundCloud offers native ads, but does not have nearly the advertising infrastructure that Twitter has. Twitter is already set to make $1 billion in revenue from advertisements this year, so from an ad sales perspective, the merger would be mutually beneficial.
If Twitter is successful in this acquisition, it would be their largest purchase to date. SoundCloud is currently valued at $700 million.
Update, 11:32 AM: Twitter has backed out of the deal with SoundCloud. An anonymous source told the Wall Street Journal that "the numbers didn't add up."
This article is from the archive of our partner The Wire.