Spotify may soon acquire SoundCloud.

Spotify, a music streaming service, is reportedly looking to acquire SoundCloud, a service which allows users to share their original music. This move would both provide Spotify with a larger library of content and remove a competitor from the market. Since SoundCloud launched a subscription service earlier this year, it has entered the paid music streaming market alongside Spotify and Apple and has apparently done quite well for itself. In July, the owners of SoundCloud were considering a $1 billion deal to sell the company to Spotify, when Twitter had invested $70 million in SoundCloud the month prior.

This acquisition is reminiscent of Apple’s purchase of Beats and Pandora’s purchase of Rdio, just a few of the many changes in the music streaming world. Both SoundCloud and Spotify having raised larged amounts of money in the past year, the pricey acquisition seems to make sense for both companies.

Spotify’s buying of SoundCloud ties into technological convergence, which we discussed in class. As mentioned during the lecture, larger entities tend to converge, while smaller user devices and services tend to diverge. The combination of Spotify and SoundCloud will make more music accessible in one location, but will it decrease the functionality of both streaming services? SoundCloud is a platform that allows users to share their original creations, whereas Spotify allows users to stream music from their favorite artists. The merge of professionally recorded music alongside amateur music may lead to a service that is less functional than Spotify or SoundCloud separately.

Problems could arise from a music library that is too large or too disorganized, a messy interface, or a haphazard attempt to separate the professionals from the amateurs. Only time will tell how consumers react to the Spotify-Soundcloud buyout.

 

Sources:

http://pitchfork.com/news/68615-spotify-in-talks-to-buy-soundcloud-report/

http://www.forbes.com/sites/hughmcintyre/2016/09/28/report-spotify-is-in-talks-to-buy-soundcloud/#473417366a49

http://www.theverge.com/2016/9/28/13098754/spotify-soundcloud-acquisition-report

2 thoughts on “Spotify may soon acquire SoundCloud.

  1. I feel that Spotify would definitely benefit from the purchase of Soundcloud in the long run. Although Soundcloud’s paid music service doesn’t even compare to Spotify’s, Soundcloud also provides an entirely different service, allowing upcoming artists to publish their music to the Soundcloud library and gain popularity as users explore the original music and remixes only available on Soundcloud. This is a pretty unique concept that could put Spotify a step ahead of rivals such as Pandora. According to the latest public statistics for Soundcloud from December 2014, there were approximately 175 million monthly active users. This statistic was made before the creation of Soundcloud’s premium service, showing that there are many users who listen to the user-posted music of Soundcloud’s library.

    Even though Spotify would likely gain many millions of users through the purchase of Soundcloud, I personally am not a fan of Soundcloud. I prefer to listen only to music by mainstream artists found on iTunes and Spotify, so the addition of Soundcloud to Spotify would be of no use to me. What Spotify chooses to do with the Soundcloud library if they make the purchase could make a large impact on their service. Combining the Soundcloud library in any way with the Spotify library would result in a large mess of songs due to Soundcloud’s large amount of remixes and lack of a naming convention. Soundcloud also contains bits of piracy since it is impossible to avoid official songs being uploaded to the database. This proves that Spotify purchasing Soundcloud would benefit their service, but their implementation of Soundcloud, if changed, would need to be designed in a way that will prevent negative affects to the current Spotify service.

    Source used: http://variety.com/2016/digital/news/spotify-soundcloud-acquisition-report-1201873039/

  2. If Spotify buys soundcloud I think it would definitely make Spotify more popular. Currently I use apple music because of the recent transactions where apple signed artists to only release there music through apple music. Im not the biggest fan of apple music because of the layout and options. Spotify has a better layout and make it much easier to navigate. Also I use Soundcloud as well because some songs or tapes are not released through Spotify or apple music because the songs are released free on Soundcloud. But I think there can be a problem with the amount of artists and songs Spotify will have to encounter. I think if Spotify can just get artists who release label albums, to also release there free music through Spotify it can definitely work.

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