Apple wishes to combine Apple Music and Shazam’s music recognition technology to provide better streaming services, but its plan was obstructed by Europe Union (EU).
The European Commission has launched an in-depth investigation into Apple’s acquisition of the music recognition service Shazam, after multiple countries (including Austria, France, Iceland, Italy, Norway, Spain and Sweden.) requested EC in February to assess the acquisition to determine whether it’s allowed under a European Union merger law. The investigate deadline is set to September 4th.
Apple’s purchase of Shazam, according to the commission, may have a significant adverse effect on competition in the European Economic Area. “The Commission is concerned that the merger could reduce choice for users of music streaming services,” said Margrethe Vestager, Europe’s top official in charge of competition.
“The way people listen to music has changed significantly in recent years, with more and more Europeans using music streaming services. Our investigation aims to ensure that music fans will continue to enjoy attractive music streaming offers.”
EU worries the acquisition may shrink the available choices of European music streaming users, and they think Apple could obtain sensitive data which help targeting the customer of its rival and encouraging potential users to use Apple Music instead.
Apple’s rivals in Europe include the Spotify (Sweden), Deezer (France), Tidal (Norway), and some. Considering that Shazam integrates multiple services, Apple’s acquisition of Shazam may have significant impact on those music streaming servers.
Apple did not immediately respond to a request for comment.
As a music recognition service provider found in London, Shazam allows users to identify songs, movies, TV shows, and commercials from short audio clips. The acquisition of Shazam is allegedly worth $400 million, far from the $1 billion Shazam was valued at during its last funding round. “We are excited to announce that Shazam has entered into an agreement to become part of Apple,” Shazam said in a statement.
Now Apple has to wait til September 4th to know if it can be approved to acquire Shazam, with or without additional conditions (or worse, the deal might be declined).