Google SoundCloud acquisition rumour

Is Google going to buy SòundCloud?  ·  Source: gearnews.com/SoundCloud

A new rumour concerning the future of SoundCloud is currently doing the rounds: a music biz site is reporting that Google is interested in taking over the Berlin-based music streaming service. And there are even some prices being thrown around, too. What could a post-Google SoundCloud look like?

The future of SoundCloud has been the subject of much debate for a while now. First, Spotify was tipped to acquire it, with a rumoured price tag of $1bn (as we reported here). Spotify walked away, however, and now the next suitor seems to be in the wings: Google. Staff at the Music Business Worldwide website are citing “music biz insiders” who inform them that Google are thinking of making an offer nearer the $500m mark.

It’s been no secret that SoundCloud has been suffering from financial difficulties. It’s evidently proving difficult for them to generate revenue from their users. It’s uncertain what impact – if any – has been made by the launch of the SoundCloud Go subscription service in terms of actually doing what businesses are supposed to do: make money. MBW also cite as an indication that a Google takeover is being considered the news that ex-Google executive Holly Lim was hired in September as SoundCloud’s first CFO.

Among SoundCloud’s current investors are several major labels such as Sony and Universal, with Twitter also reportedly buying a $70m stake in June 2016. Google will certainly be able to plug any gaps in financing, and may be able to successfully leverage SoundCloud’s large user base of 175 million. And it might function as a useful add-on to the Google’s Play Music and YouTube Music offerings. I suspect Google might keep the SoundCloud brand, too, as they have done with other acquisitions in the past. Google certainly won’t have any problems pumping new capital into the company to keep it afloat.

It’s certainly a much-loved site, especially with musicians and composers. And that might be the aspect that’s got Google licking its lips: this is a community of creatives, an internet service with personality and a sense of mission. And it’s unique as music streaming services go. Yes, it’s got its faults. But with or without Google, here’s hoping SoundCloud will be around for the foreseeable future.

Here’s the Music Business World article that sparked all the commotion.