Social media giant, Twitter invests in SoundCloud’s music streaming service…
According to reports, Twitter has invested $70 million in SoundCloud’s music streaming service as part of a funding round that will reportedly add up to $100 million or more. The funding round will see SoundCloud’s value estimated at approximately $700 million, according to a Recode report.
Twitter CEO Jack Dorsey said…
“Earlier this year we made an investment in SoundCloud through Twitter Ventures to help support some of our efforts with creators. They’ve been great partners of ours over the years and their community-supported approach mirrors ours in many ways.”
What does this investment mean for the streaming platform?
In March, SoundCloud launched its paid streaming service: SoundCloud Go, in the US and later launched it in the UK in May. Since its launch, there have been no reports on the number of subscribers that have signed up. But, DMN predicts that the service hasn’t seen a major rush of music users sign up to the new paid streaming service, as people have been using the platform for free for a long time. This struggle to convert non-paying users to a paid service, is a similar situation that YouTube is in with its Red service. It is difficult to change music users’ attitudes to the way they consume and pay for music.
With this major investment, it will allow SoundCloud to better compete with major rivals Spotify – which has racked up over 30 million paying users, and Apple Music – which just announced hitting 15 million users. What this cash injection will be specifically used for is unknown at this stage, but one would presume that the investment will lie heavily in its features, expanding globally and its content.
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