Music streaming company Spotify has bought Irish startup Soundwave for an undisclosed sum.
The acquisition will see the music analytics firm integrated into the Swedish firm’s service to bolster its product on the music discovery front.
The app tracks what songs people are listening to on their smartphones and where in real time, allowing them to share their favourite tracks with friends without having to leave their chosen service.
The exact amount of the deal has not been made public, but chief executive Brendan O’Driscoll said all parties involved in the deal were happy with the price.
“Everybody is smiling,” he said.
The company will integrate into Spotify over time, but for now it’s business as usual for the Dublin-based tech firm.
Mr O’Driscoll said Soundwave had worked with all the streaming services, building relationships with different players in the market for some time.
Spotify is currently the largest streaming music service, with more than 25 million paying customers and an additional 75 million using the company’s ad-supported free service.
When the company started out, Mr O’Driscoll said, its aim was to solve the music discovery problem, and streaming services were only gaining foothold.
“When we started, streaming was not the norm,” he said. “Music consumption has changed a lot. It was all iTunes at the start. Now we’ve got a number of different streaming services.”
The reason for Spotify’s interest is clear. At the Web Summit last November, one of Spotify’s senior product developers Matthew Ogle told attendees music discovery - using algorithms to create recommended playlists for users - is no longer optional for streaming services. “Discovery is not a problem to be solved,” he told the Web Summit. “It’s a huge opportunity.”
As the music streaming market gets more competitive - The Financial Times recently estimated Apple has increased its customer base to 10 million paying customers - music discovery is could be the key differentiator between the services.
“It’s about nailing it the first one or two times a new users enters a service,” Mr O’Driscoll said. “If we can continue to do so for Spotify, it would be advantageous for them.”
Soundwave was set up in 2012 by Brendan O'Driscoll, Aidan Sliney and Craig Watson. Based in Rathmines, the company has been getting quite a bit of attention since its launch.
The service has found some celebrity fans, including Apple co-founder Steve Wozniak and actor Stephen Fry, who helped launch the app when it hit the market in 2013. It has since been downloaded more than 1.5 million times in 190 countries. Among its accolades are a Best Innovation in Music by Apple in 2013, named "Top Developer" by Google, and in 2013 Forbes voted Soundwave one of five companies that made media consumption smarter.
Among its backers are ACT Venture Capital and Dallas Mavericks owner Mark Cuban.