SoundCloud is a free music and audio-sharing company that lets users upload and share audio files -- a "YouTube for audio" as it describes itself. If the deal were to go forward, it would be Twitter's largest acquisition. The report does not say how much Twitter would need to buy SoundCloud, but earlier this year SoundCloud was valued at $700 million.
A Twitter deal could appeal to SoundCloud, because it would give the audio company a real shot at selling ads in front of or alongside its music streams.
A Twitter deal will also likely up the pressure on SoundCloud to reach a deal with the big music labels to distribute their songs. SoundCloud doesn’t have any deals now, which puts it in a gray area similar to YouTube in its early days: Some copyrighted songs are on the service without the owners’ permission, but others are uploaded by artists and labels that value the distribution SoundCloud provides.
Both SoundCloud and Twitter declined to comment.