European Commission starts in-depth investigation into Shazam takeover by Apple

The European Commission has announced that it has begun an in-depth investigation into Apple’s acquisition of Apple’s music recognition app Shazam. The Commission is concerned that the acquisition will lead to less choice in the market for music streaming services.

The European Commissioner for Competition, Margrethe Vestager, says that the study is intended to ensure that music fans can continue to enjoy ‘attractive music streaming services’ and thereby do not have to deal with fewer options on this market. The Commission is concerned that Apple acquires commercially valuable and sensitive data about the customers of its competitors through the acquisition.
According to the Commission, access to these data enables Apple to directly engage its competitors’ customers reach and move them to switch to Apple Music. This would allow Apple to outperform competitive streaming services, thus leading to a competitive disadvantage. Vestager says the Commission will also investigate whether Apple could harm competitors after the takeover by removing the Shazam app from the market. Moreover, the Commission does not yet regard Shazam as an indispensable service for music streaming services.
The transaction involving takeover plans was notified to the European Commission on 14 March. The Commission has 90 days to decide on the takeover; the deadline is thus 4 September. According to the Commission, the start of this in-depth investigation says nothing about the decision to be taken.
Apple confirmed in December last year that it wants to take over Shazam. An acquisition price was not then announced. According to a earlier rumor Apple is prepared to put an amount of approximately 341 million euros on the table for Shazam. It is not entirely clear what Apple wants to do with the music recognition of Shazam, but in 2014 there was already a rumor that Apple wants to install the service in iOS.
Seven EU Member States, Austria, France, Ireland, Italy, Norway, Spain and Sweden have already knocked on the door to the European Commission in February and asked whether the EU could investigate Apple’s takeover plans . The Commission has accepted this joint request. This means that in any case the national competition watchdogs of these seven Member States will not start their own investigations.

 

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