Exclusive: SiriusXM renews ad sales deal with SoundCloud

SXM Media, the sales group of Sirius XM Holdings, has renewed its U.S. ad-sales deal with SoundCloud through at least 2024, the company exclusively tells Axios, in a move to grow revenue for both audio platforms.

Why it matters: SiriusXM, which bought a $75 million minority stake in SoundCloud in 2020, will continue splitting the ad revenue between the two companies, according to the agreement.

• The deal aligns with the company's strategy to be a leader in audio ad sales amid stiff competition for listeners and subscription dollars. 

Details: The expanded deal makes SoundCloud's U.S. ad inventory available on AudioGO, a self-serve ad platform launched in 2020 by SiriusXM-owned AdsWizz, for the first time.

• SoundCloud has a separate agreement with AdsWizz for some European markets.
• Since the ad sales partnership began in 2019, the number of brands on SoundCloud has increased by more than 20-fold, says Phil Wierzbinski, vice president of revenue partnerships at SXM Media.
• SoundCloud's audience is "engaged, diverse and increasingly Gen Z," he says.

The big picture: SiriusXM's traditional business of satellite radio continues to be impacted by the rise of streaming audio.

• The company expanded into the new era with its acquisition of Pandora, but it still faces stiff competition from Spotify, Apple and other audio platforms.
• To compete, SiriusXM has positioned itself as a leader in audio ad sales by investing in ad tech and a focused sales organization. SXM Media has sales partnerships with other external companies, including NBCUniversal, Audiochuck and Crooked Media.
• Meanwhile, Spotify has focused on beefing up its own content by buying podcast studios and signing exclusive licensing deals and, at the same time, investing more in its own ad business.