
Apple Buys Shazam to Boost Apple Music - kentwistle
https://www.bloomberg.com/news/articles/2017-12-11/apple-buys-early-iphone-app-hit-shazam-to-boost-apple-music
======
wonderous
>> “Shazam, the 18-year-old company...”

Fact that Shazam is 18-years-old made me curious, and found the following on
Wikipedia:

>> “Initially, in 2002, the service was launched only in the UK and was known
as "2580", as the number was the shortcode that customers dialled from their
mobile phone to get music recognised. The phone would automatically hang up
after 30 seconds. A result was then sent to the user in the form of a text
message containing the song title and artist name.”

SOURCE:
[https://en.wikipedia.org/wiki/Shazam_(company)](https://en.wikipedia.org/wiki/Shazam_\(company\))

~~~
dsnuh
I remember the first time I Shazamed a song. It was during the flip phone era
and it was honestly the most magical thing to me at time. I had always wanted
something like this, and here it was at my fingertips.

~~~
ams6110
At that time, I wonder if there was any technology actually identifiying the
song, or if it was a big mechanical turk sort of operation.

~~~
guelo
Amazon's Mechanical Turk service launched in 2005.

~~~
toomanybeersies
The concept of the "Mechanical Turk" has been around for over 200 years:
[https://en.wikipedia.org/wiki/The_Turk](https://en.wikipedia.org/wiki/The_Turk)

~~~
lstyls
It's pretty obvious what GP meant. The concept of crowd-sourcing small chunks
of work as a service is not the same thing as a hoax which involved a single
person masquerading as an automaton. Amazon chose a clever name for its
service that is memorable and references humans fronted by machines.

Asserting otherwise is an example of the etymological fallacy:
[https://en.wikipedia.org/wiki/Etymological_fallacy](https://en.wikipedia.org/wiki/Etymological_fallacy).

~~~
Retric
Ehh, I have seen references to using a person instead of an algorithm before
Amazon released their service. Basically, if your automating human dexterity
it's robotics, if your automating the brain it's AI. Sorting vegetables being
a useful early example where humans could be thought of as a replaceable black
box if you can break down what they are specifically doing. Thus Machine
vision and classification where two common tasks because you need to play any
game not simply replay a specific one.

------
kin
I love Shazam but honestly, if they remove integrations like "Open in Spotify"
which seems likely, I would probably switch to using SoundHound.

~~~
mwilliaams
Apple is probably going to kill the app. They probably just bought it for the
tech.

~~~
amelius
(removed)

~~~
vedant
This has the smell of a comment written by someone with limited real-world
experience. Simply writing down the list of problems you would have to solve
to build Shazam would take an entire afternoon.

Yes, deep neural networks have proven remarkably useful for machine
perception, but you would still need to collect a colossal amount of audio
data, fingerprint all of it, build a low-latency processing infrastructure for
making inferences, and convince a hundred million people to install your
software to feed you copious real-world training data that you can use to
improve model performance.

~~~
amelius
> and convince a hundred million people to install your software to feed you
> copious real-world training data that you can use to improve model
> performance.

That's actually the easy part. You already have the music. Distorting it by
superimposing background noise is really not difficult.

~~~
tsomctl
Lol. When you superimpose noise, the original data is still there. When you
have a FM radio playing staticky, heavily compressed music through crappy
speakers in an acoustically terrible store and being captured by a terrible
microphone and then being compressed, a significant amount of nonlinear
distortion has taken place. That is extremely hard to model. And you would
have to model it or have real data to train a neural network. Neural networks
are extremely hard to train without excellent data.

~~~
amelius
> playing staticky, heavily compressed music through crappy speakers in an
> acoustically terrible store

I think you just confirmed how easy (and cheap) it is to actually generate
this data.

------
ChuckMcM
Wow, that is an unusual exit after 6 rounds of funding. Crunchbase has it at
$143M in funding up to that point.

It goes to show how the switch from radio (station directed programming) to
streaming (user directed programming) has put a huge crimp in music discovery
and music promotion.

[1]
[https://www.crunchbase.com/organization/shazam](https://www.crunchbase.com/organization/shazam)

~~~
rjett
Question from a non-Silicon Valley professional: Where does all that money go?
Obviously, some [likely big] portion of it is still on the balance sheet, but
does an app like Shazam really cost that much in engineering talent to update
it and iterate it and server space to keep it running?

~~~
ChuckMcM
It varies quite a bit from company to company. They were founded in 2001 so I
expect most of it was salary and physical plant.

The business is/was connecting resale opportunities to brands and artists[1]
so you'll have a fairly significant sales and marketing effort although
typically you will pay sales people for performance so their compensation will
track revenue.

But to give you some things to think about, if you have an engineering team of
15 engineers, median salary $120K, and an 'overhead' (office, health plans,
insurance, etc of 60%) then that is $200K/engineer/year (or $3M/year or $48M
for 16 years [2001 - 2017]) that is just integrating cost per engineer over
time using constant engineering. You can put any function in you want for head
count (does it grow exponentially? does it grow in chunks? etc) and then add a
C-suite team (higher median salary) and an 'overhead' team (IT, marketing, HR,
etc) and you can burn through that fairly quickly.

It is a useful thing to build models for this stuff as your 'pre-
operationally-cash-flow-positive' costs are really the health and future of
your company.

[1] [https://www.shazam.com/company](https://www.shazam.com/company)

~~~
paxy
For a company with offices in the most expensive cities in the world $120K is
likely closer to the starting salary than the median.

~~~
djrogers
There are a lot of people that work at tech companies that aren’t highly paid
engineers. GP specifically called out engineers at a higher salary, so GP was
obviously including receptionists, admin staff, etc. I’d be shocked to find
that the starting salary _anywhere_ around here is 120k.

~~~
tptacek
Ok, but you also seem to be doing math that assumes salary is fully loaded
headcount cost; fully loaded cost is (rule of thumb) 1.5-2.5x salary.

------
StephenMelon
The data that Shazam can gather must be incredibly useful to record labels, in
that many people wanting to know the artist/song is a strong signal that a
track is a potential hit. Since Apple already have data about what people are
actually listening to (by location), this gives them additional data about
what people might want to listen to.

~~~
chiefalchemist
Forbes, or was it BusinessWeek, actual did an article on that (i.e., selling
data to record labels) a year or so ago. If I get a moment I'll try to track
it down later.

~~~
nerfhammer
Maybe this? [https://www.theatlantic.com/magazine/archive/2014/12/the-
sha...](https://www.theatlantic.com/magazine/archive/2014/12/the-shazam-
effect/382237/)

~~~
chiefalchemist
Ah. Yes. Damn. I knew it was a mag I read on the regular but didn't think to
think The Atlantic would cover such a think.

Good catch. Cheers mate.

------
bsimpson
I'm a bit shocked that they're paying $600M. Is Shazam even profitable? It
feels like a clever tech demo from 10 years ago that's already been replicated
in search engines like Google.

~~~
meritt
Yes, they became profitable in 2016 via mostly brand advertising [1][2]. The
company has nearly 400 employees according to LinkedIn. With a very
conservative personnel estimate of $125k/employee/year, that's $50M alone.
Let's throw on another $25M for everything else and they need to be doing at
least $75M+ in annual revenue.

[1] [https://www.macrumors.com/2016/04/20/shazam-for-brands-
user-...](https://www.macrumors.com/2016/04/20/shazam-for-brands-user-
activity/)

[2]
[https://www.billboard.com/articles/business/7526322/shazam-1...](https://www.billboard.com/articles/business/7526322/shazam-1-billion-
downloads-profit-advertising)

~~~
charlesdm
Perhaps I have limited understanding of running a £40m a year business, but
why does an app like Shazam need 400 employees?

Even if selling data and/or advertising, do they need (say) a 200 people sales
team.. ?

~~~
meritt
I have no idea, it's bewildering to me frankly. Take two recent IPOs for
example: MongoDB had 820 employees as of July 31st. StitchFix had 5,800
employees as of July 31st [2].

[1]
[https://www.sec.gov/Archives/edgar/data/1441816/000104746917...](https://www.sec.gov/Archives/edgar/data/1441816/000104746917006014/a2233365zs-1.htm)

[2]
[https://www.sec.gov/Archives/edgar/data/1576942/000119312517...](https://www.sec.gov/Archives/edgar/data/1576942/000119312517313629/d400510ds1.htm)

------
MrTomahawk55
Has anything replaced "Into Now"? I loved using it, and ever since Yahoo
bought them up and then shut them down, I've always wondered why Shazam or
Sound Hound hadn't integrated the audio from TV shows and movies into its
database.
([http://mashable.com/2011/01/31/intonow/](http://mashable.com/2011/01/31/intonow/))

------
jccalhoun
from now on it will only identify U2 songs.

------
grep4master
It would be nice to have the song identification feature on iOS while on
standby like the Pixel 2 does.

~~~
whoisjuan
I still can't understand how that feature works. They stated that everything
is done locally on the device, so privacy is not an issue. But how can they
host a huge catalog of songs fingerprints without blowing the storage? Are
they only saving the top charts?

~~~
indy
They only store a catalog of the most popular songs. (Where 'most popular' is
determined by your geographical location). This catalog is periodically
updated.

~~~
neves
Isn't the use case to find obscure music? Weird to have just popular ones. To
"discover" a top 10 hit I can just ask someone nearby.

~~~
mjlee
I think the Pareto principal kicks in hard here. If it stores the top 20,000
songs as the other comments suggest then I expect that would include the vast
majority of music you’d come across.

------
greggman
personally I've found Soundhound to be much better. Havent used Shazam in a
long time though.

------
cma
> The 18-year-old company, which has required twice the average time to
> deliver an exit for backers, was valued at about $1 billion when it closed
> its last funding round in 2015.

If the last round had a strong liquidity preference then it wasn't really
valued at $1 billion, and those investors might have even come out ahead.

------
Sholmesy
Shazam operates on my street! Was an interesting surprise...

This feels like a natural acquisition to compete w/ some of Googles offering
w/ the latest Pixel 2.

The fact Shazam is 18 years old is crazy. Pre-dates "apps" with the "2580"
service and was one of the first apps on the iPhone.

------
DoodleBuggy
Spotify remains a far better experience and product than Apple Music. Why not
buy Spotify?

~~~
yoz-y
Apple does not seem to like to do big purchases. Even though they probably
could. Spotify is not (yet) profitable so they would probably have to hike up
the prices. At this point they are probably better off doing their deals on
their own and slowly catch up.

~~~
romanovcode
>and slowly catch up.

I don't want to be anti-apple because I like most of their stuff but iTunes is
complete garbage compared to Spotify.

With the stuff they have now they will never catch up.

~~~
yoz-y
I should probably try Spotify as so many people say it is better than Apple
Music (which I do genuinely like). Spotify currently offers 3 months premium
subscription for 1€ so it may be worth a shot.

------
robmcm
This is (unfortunately) a huge testament to patenting technology. I remember
Shazam shutting down a lot of early iOS apps that provided music discovery
services. The technology it’s self became relatively simple in the last 10
years, but their ownership of the patent has kept them on top.

I suspect it’s due to end soon, and they realised once it’s gone they would
just become a feature of music streaming services. Good to get out now while
there is still some exclusivity for Apple to milk.

------
spike021
I've used Shazam for years but lately for some reason I've been running into
more music that it can't identify from two separate phones (so it's not
possibly a bug limited to one device).

Hoping this doesn't mean there service is degrading because I've really
benefited from it over the years.

~~~
fossuser
My issue with it was that it got too good.

I used to use it to identify music in shows or soundtracks, but it started
just saying "Breaking Bad Episode 4" which while more accurate was less
helpful.

Shortly after that everyone else had music discovery natively anyway.

------
dsnuh
Can anyone think of another brand that has become generalized as an action,
the same way as "Googling" other than Shazamed? To me "Shazam it" is shorthand
for use whatever music ID service you have.

------
sctb
Recent discussion:
[https://news.ycombinator.com/item?id=15881896](https://news.ycombinator.com/item?id=15881896)

------
Aissen
Probably a way to pay less taxes; they won't have to bring EU cash to US, and
get to cash it out before Brexit.

It's also a nice acqui-hire; Spotify already snatched Echo Nest a few years
ago, so they get to catch-up with Shazam.

