Spotify is speeding up its pace of service with intelligent tools and has bought The Echo Nest.
Spotify recently announced that it’s acquired music data firm The Echo Nest. This will allow users of the music streaming service to have a better experience in discovering different artists and genres of music. The details of the deal were not disclosed.
While Spotify has been collaborating with The Echo Nest to power its radio service, having the latter under its umbrella will allow it to seal its spot as a go-to partner for brands that want to reach out to different audiences.
According to Spotify, The Echo Nest will continue to operate independently out of its offices in Massachusetts and San Francisco. The combined companies will also keep the API of the music intelligence platform open and free to developers. The APIs of the two firms have been integrated since March 2012.
The two companies, together with Microsoft, collaborated in March last year to launch the visualization tool called Mixshape that can sort playlists depending on different moods and properties of songs.
Daniel Ek, Spotify founder and chief executive officer, revealed that Spotify has long been a fan of what The Echo Nest can do. Ek believes that the latest acquisition will help the company play the best music for its users.
Other players in the music streaming industry must’ve held their breath with the purchase of The Echo Nest since it powers most services such as Rdio, Twitter Music, VEVO, MOG, and eMusic but the company clarified that The Echo Nest will still with rival brands and as long as they see these relationships beneficial, there is nothing to worry about. So, most likely competitors of Spotify has nothing much to worry about (Read: for now).
While there have been no public announcements, the latest move is seen by many as preparation of Spotify for its initial public offering.
The music streaming service firm backed by Asian billionaire Li Ka-Shing is allegedly in talks with banks to create a credit facility, said a Bloomberg report. Spotify is purportedly working with Goldman Sachs to help arrange the necessary facility. The information came from two sources who are familiar with the matter according to Bloomberg.
The pattern is the same just like when Facebook and Twitter were about to go public. The social network firm got financing packages before hitting NASDAQ and micro-blogging site also got a billion worth of credit facility a month before it went public.
Neither Spotify nor Goldman Sachs wanted to comment about the possible IPO.
The music streaming industry is expected to have a boom in the next few years. At the moment, roughly 29 million enjoy listening to their favorite music through such services by ABI Research projects that it can be as much as 191 million come 2018.
Another forecast spending on digital radio to around $2.04 billion for 2014. Research firm EMarkter forecast the customer base to jump by as much as 33 percent by 2016 compared to 2012 numbers, this translates to monthly listeners of as much as 176 million people.