The European Union has been eyeing Apple’s plans to buy Shazam for a while now. Back in February, it noted that the deal raised some preliminary competitive concerns. Today, the EU announced that it’s all in, launching an “in-depth” investigation into the deal.
In a press release issued earlier today, Commissioner Margrethe Vestager notes, “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 and won’t face less choice as a result of this proposed merger.”
The release adds that Apple Music and Shazam are both “significant and well known players in the digital music industry that are mainly active in complementary business areas.” Of course, on the face of it, the two offerings fulfill distinctly different functions — one’s a streaming music service and the other’s that thing that makes you awkwardly hold your phone above your head in a noisy bar because you have to know the name of that Flo Rida jam.
But Apple Music has become the second largest music service in the EU (behind you know who), and the Commission is concerned that the company will use Shazam to continue that growth by directing users to the service through the songs they identify on Shazam. Which, honestly, seems like a no-brainer, should the acquisition go through.
“As a result, competing music streaming services could be put at a competitive disadvantage,” the commission writes. “In addition, while at this stage the Commission does not consider Shazam as a key entry point for music streaming services, it will also further investigate whether Apple Music’s competitors would be harmed if Apple, after the transaction, were to discontinue referrals from the Shazam app to them.”
From the sound of things, it seems likely that, should the deal go through, there will be some stipulations attached, like a prohibition on the aforementioned discount referrals from one service to the other. We’ve reached out to Apple for comment.
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