Apple's purchase of Shazam is $400 million well spent

At the tail-end of 2017, Apple announced that it was buying music discovery service Shazam for $400 million. Now that the deal has completed, the company has revealed that the platform will soon go ad-free. Even without the revenue that advertisements bring, it's likely that the purchase price will be a bargain if Apple can use Shazam to become king of streaming.

There are plenty of numbers to support Apple's judgment, like the fact that Shazam has been downloaded more than a billion times. And that the app is used more than 20 million times a day as folks across the globe sniff out what's playing. But the really important number is 23 million; the disparity between Apple Music and Spotify's subscriber numbers.

In the Spring, Apple Music passed the 50 million user mark, the majority of which are paying customers. Spotify has 83 million, a fact that must cause some consternation for the iPhone maker. Now, it's likely that Apple Music's explosive growth will continue, and just because of Apple's size and reach, Music will naturally overtake Spotify.

Coasting to victory isn't an option, however, and Apple will want to lure Spotify's existing users, people who are already prepared to pay for music. They may not be swayed by flashy ads or a bigger music library (honestly, 40 million songs is plenty) but by a more compelling product. And Spotify can rest easy knowing that its product is pretty compelling already, especially in discovery.

Apple Music is considerably younger and has a corporate parent that is famously unwilling to exploit its user data. Shazam's massive database of songs, tastes and listening behavior, which has been running for close to a decade, is just what Apple needs. It won't hurt that Shazam knows what's going to be a hit before anyone else does, thanks to all of the trend data it has.

Shazam already offers algorithmic suggestions for new songs, as well as tailored playlists that meet your tastes. Users can also see a Top 100 chart divided by country and even their local city. Imagine what Apple could do if it knew that 50,000 people are all listening to an obscure local act with a potential chart-topper?

I'm reminded of Onavo, the VPN that Facebook bought in 2013, which tracked what users were doing on their phones. This information alerted Facebook executives to what was hot, including Snapchat (which it tried to buy, and then copied) and WhatsApp (which it bought).

If the streaming wars has an eventual winner, it won't be through pricing or the size of the music library on offer. Instead, it'll be which company best uses the data it has to serve up tunes for its users can fall in love with. $400 million? Apple can earn that back in a matter of months if it can lure enough Spotify customers to switch sides.



via Engadget RSS Feed https://ift.tt/2Q4smHO
RSS Feed

If New feed item from http://www.engadget.com/rss-full.xml, then send me


Unsubscribe from these notifications or sign in to manage your Email Applets.

IFTTT

Comments

Post a Comment

Popular posts from this blog

Evernote cuts staff as user growth stalls

Image
Note-taking app Evernote has fallen on hard times of late, culminating in its latest spate of job cuts impacting 15 percent of its workforce (54 employees). CEO Chris O' Neil -- an ex-Googler who took the reins in 2015 -- announced the firings at an all-hands meeting earlier today, reports TechCrunch . In a message on the Evernote blog , O' Neill admitted he'd set "incredibly aggressive goals" for the company in 2018. He continued: "Going forward, we are streamlining certain functions, like sales, so we can continue to speed up and scale others, like product development and engineering." The layoffs follow an exec exodus just weeks ago and the company's recent brand refresh (complete with a refined logo and wordmark). But critics are more concerned about its product, especially the free tier, which they claim lacks the perks to...
Read more

The best air conditioner

Image
By Liam McCabe This post was done in partnership with Wirecutter . When readers choose to buy Wirecutter's independently chosen editorial picks, it may earn affiliate commissions that support its work. Read the full article here . After six summers of researching, testing, and recommending window air conditioners, we've learned that quiet and affordable ACs make most people the happiest—and we think the LG LW8016ER will fit the bill in most rooms. This 8,000 Btu unit cools as efficiently and effectively as any model with an equal Btu rating, and runs at a lower volume and deeper pitch than others at this price. Little extra features like a fresh-air vent, two-axis fan blades, and a removable drain plug help set it apart, too. The LG LW8016ER is a top choice for an office or den, and some people will find it quiet enough for a bedroom, too. If our main pic...
Read more

We won't see a 'universal' vape oil cartridge anytime soon

Image
Pre-loaded cartridges of cannabis concentrate are currently among the most popular means of consumption, and for good reason. They're discreet to use and easy to handle, a far cry from the dark days of 2016 when we had to dribble hash oil or load wax into narrow-mouthed vape pens by hand. But, frustratingly, an ever increasing number of oil cartridge manufacturers employ one-off design standards so that their products won't work with those of their competitors, thereby locking customers into proprietary ecosystems. We've already seen this with nicotine vaporizers -- which has a seen a massive rise in "pod systems" in the last few years, each outfitted with a unique canister and battery built to be incompatible with those of their competition. Is it too late for the burgeoning cannabis industry to set a universal standard for their product designs? ...
Read more