SoundCloud to sell ads on UK music streaming service

SoundCloud, the music streaming and sharing service, is to sell advertising for the first time in the UK through Global's digital audio exchange, Dax.

SoundCloud claims 175 million monthly listeners
SoundCloud claims 175 million monthly listeners

Global, the owner of radio stations including Capital and Heart, hailed the deal as a "milestone" because it showed Dax can cater for big, audio tech platforms as well as traditional radio broacasters.

SoundCloud, which claims 175 million monthly listeners for its "open" music and audio platform, introduced advertising in the US in 2014 and has run campaigns with brands including Pepsi, Netflix, Amazon, and 20th Century Fox.

Global launched Dax in 2014 to sell online radio and audio inventory, particularly through new technology such as programmatic that allows automated, real-time buying, and has been keen to bring in new partners.

Spotify was briefly involved in Dax but withdrew, so the decision by its streaming rival, SoundCloud, to sign a deal is a boost for Global.

Dax will sell interstitials as well as audio advertising across all SoundCloud’s web and mobile properties.

Mike Gordon, the chief commercial officer at Global, said: "Dax is growing at a phenomenal rate to keep pace with the demand in the market. As more and more people spend time listening to digital audio, many advertisers have been quick to recognise the opportunity to reach these highly engaged audiences.

"We targeted SoundCloud as an ideal partner we wanted to work with right at the beginning when we were developing the Dax platform. This is a huge milestone and a great testament to the success of Dax that the biggest audio streaming platform in the world is now a partner."

Website builder Squarespace and music sales site TuneCore, two existing advertisers on SoundCloud in the US, will be the first advertisers in the UK.

Alison Moore, SoundCloud’s chief revenue officer, said: "As the established digital audio advertising industry leader, Dax is a natural fit for our monetisation program at SoundCloud."

Group M was upbeat about the prospects for Dax when the media buyer made its 2016 forecast for the UK radio advertising market at the turn of the year.

"Dax is not yet the industry standard," said Group M. "One third of its inventory is Global’s, but the remainder does not make Dax the in-stream universe. It is however dominant. We do not know what it bills, but if it was a million a year ago, it is multi-millions now."

SoundCloud, which has hired David Couch as head of sales in the UK, will sell native advertising in-house.

The streaming service is also launching a subscription version, called SoundCloud Go, which allows users to opt out of advertising.

SoundCloud, which was founded by Alexander Ljung and Eric Wahlforss in 2008, claims to "empower artists" by letting them upload their music.

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