Streaming was supposed to kill satellite radio, but SiriusXM clearly doesn’t see it that way. The satellite radio and audio entertainment company just announced a $75 million strategic investment in SoundCloud.
In a release announcing the investment SiriusXM points out that the sum will be used to “accelerate [SoundCloud’s] product development and enhance the services that fuel its global community of creators and listeners.”
SiriusXM made the $75 million investment via the purchase of securities. Two new seats on SoundCloud’s board of directors will be taken by directors approved by SiriusXM.
SiriusXM is already an owner of Pandora, an early music streaming favorite which was largely eclipsed by Spotify and AppleMusic’s tremendous growth in the United States. Aside from “creating value” for stockholders, SiriusXM may be looking to strengthen its existing ad sales leveraging SoundCloud’s inventory (i.e., individual music streams). SoundCloud and Pandora entered into an ad sales relationship in 2019 which enabled Pandora’s sales team to sell ads on SoundCloud’s American inventory directly.
SoundCloud was seeking a sale and close to bankruptcy just three years ago. They recently announced the introduction of paid promotion on SoundCloud as well as expanding SoundCloud’s artist monetization program.