Apple, Shazam and the advent of social music
A view from Felim McGrath

Apple, Shazam and the advent of social music

Music is the next big technology land grab and advertisers should take notice.

There are plenty of ‘natural fit’ reasons behind Apple’s decision to buy Shazam. Above all, the music and sound recognition service already integrated with Siri could gain a deeper integration with iOS, better challenging Google’s song recognition feature on the Pixel. However, this latest venture into the audio world shouldn’t be seen out of context.

The truth for advertisers is that music is becoming the latest industry to be transformed by the digital land grab taking place between technology and social media giants.

Across 2017, video established itself as the new driving force of social innovation and engagement with both Facebook and Snapchat investing in original TV content to be made available via their platforms. As we arrive in 2018, the question naturally becomes ‘where next?’ 

While technologists including Google and Apple see music as a major business pillar with Google Music and iTunes in the mix, the acquisition and hiring strategy of Facebook suggests that this social behemoth is beginning to take music seriously as well.

In July 2017, Facebook snapped up copyright identification start-up Source3. Throughout the year it hunted for numerous senior positions relating to music licencing, after poaching Tamara Hrivnak, former director of music partnerships at YouTube, early in the year. To a certain degree, Facebook has forced its own hand here – obliged to contend with music rights owners protesting that their content is freely available on the platform via user-uploaded music videos.

Of course, music has been an important part of social networking since the days of Myspace, and in many ways the big social services are already part of the music business. Success in drawing artists and bands to create pages/profiles and interact with fans has made social media a key part of any music label’s strategy. Social media’s previous attempts to capitalise on this relationship haven’t been all plain sailing, however – 2015’s ‘Music Stories’ feature on Facebook failed to gain widespread interest, while Twitter’s #Music service was shuttered in 2014. And, as many platforms have discovered, navigating the sea of contracts and agreements necessary to provide a rich music streaming library is not easy.

But in their ongoing quest to maintain engagement on their platforms, these social giants will surely have noticed the digital transformation that has impacted the music industry and the broad user bases that streaming services have gathered. It’s now 63% of digital consumers globally who are listening to music streaming services and with internet users now more likely to say that they prefer to stream music online, rather than own it themselves, the figures will only grow. 

What’s more, adding another revenue stream will be attractive to the big names in social media, particularly given their enthusiasm for diversifying into the worlds of video and commerce. Exactly how they achieve this will certainly be interesting to watch. So far, most consumers have been quite reticent about paying for access to music, and for purchasing content directly via social media.

Social platforms’ traditional revenue models – providing services/content in exchange for data and advertising exposure – is one with which music labels are becoming increasingly frustrated. Apple Music and Tidal have touted the ‘premium-only’ model as the future of music streaming, while Spotify has felt the heat for steadfastly defending its ad-supported offering. Yet the social media industry’s laser-focus on user growth and engagement means that it will surely push for freely accessible music for its users.

However, it comes about, the advent of social music is upon us. As in the realm of TV, there will be much speculation about what strategy the big social platforms, particularly Facebook, employ to breach into this industry. But regardless of the details, it looks like music will be the next media to go social.

Felim McGrath, senior trends manager at GlobalWebIndex