News October 27, 2015

Twitter and SoundCloud end acquisition talks

Former Editor

Talks which mooted the potential acquisition of SoundCloud by social media behemoth Twitter have apparently collapsed, despite a media flurry announcing the news yesterday.

The suggestion, first reported on by Re/code yesterday, questioned whether SoundCloud could improve Twitter’s core service enough to warrant the estimated buy-out figure of $700 million.

Other questions were raised regarding SoundCloud’s limited licensing agreements with the major labels and music publishers and how that would impact on Twitter’s plans in the music space. SoundCloud currently operates under the Digital Millennium Copyright Act (DMCA) loophole, giving the site immunity due to its third-party, user-generated content.

Now, German news outlet Spielgel Online (also based in SoundCloud’s Berlin hometown) has said that while Twitter was mulling the idea of a buy-out, the company has decided not to go ahead with the deal.

The Wall Street Journal spoke to an unnamed source that said Twitter let the deadline for a discussion about an agreement pass because “the numbers didn’t add up.”

The acquisition would have been Twitter’s biggest since last September’s buy-out of mobile ad exchange company Mopub. which was purchased for $350 million.

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