Apple Inc. is acquiring Shazam, one of the first apps to demonstrate the power of the iPhone.
Apple acquired Shazam, one of the most popular music apps in the world, through an operation that pegged the price at around $400 million, according to Tech Crunch’s first report.
The company founded by Steve Jobs was on the hunt for the streaming app for about 5 months now, having also meetings with companies like Snapchat and Spotify, and now, it could be Apple’s largest purchase ever.
A disappointing acquisition for some
Even though the app has set a benchmark, the price is not fair for some.
Some of Shazam Entertainment Ltd.’s investors see it as a disappointment, as they had valued the company at about $1 billion when it closed its last funding round in 2015.
This has happened because although Shazam has been popular among customers, the app has struggled in turning its clever music service into a business that justified its valuation.
Some sources to Tech Crunch have assured that for all of Shazam’s popularity and move into revenue-generating areas like marketing, the company never really found a solid business model for the long-term future.
How does Shazam work?
Shazam’s core business is in music recognition.
The app uses the microphone on a smartphone or computer to identify almost any song playing nearby, afterwards, it points users to places where they can buy and listen to it in future, such as Apple Music or Google’s YouTube.
The app’s key point
Here are the key numbers for the app:
- It was founded in 1999.
- During November, the app had about 175 million monthly active users globally across iOS and Android, according to research firm App Annie.
- It was valued at $1 billion after its most recent funding round in 2015.
- Shazam already integrates with Apple Music, referring many of its 100 million users to play songs on its platform.