Apple’s planned US$400 million acquisition of music discovery app Shazam has hit a snag with European regulators.
The tech giant will need to formally ask for European Commission approval after Brussels revealed it would examine the deal following requests from seven countries.
After several months of negotiations, Apple confirmed last December an agreement had been struck to buy the London-based Shazam, which execs described as “a natural fit” for Apple’s own music activities. Though the price-tag wasn’t revealed, tech writers suggested a sum of $400 million would change hands, a figure that would typically fly under threshold for an EU probe.
According to a report published by Reuters, however, the EU’s corporate watchdog now says that, based on preliminary data provided by those seven markets, the pact may have a significant adverse effect on competition.
The inquiry was sparked when Austria reportedly asked the Commission to study the deal, with France, Iceland, Italy, Norway, Spain and Sweden – the home of Apple Music’s rival Spotify – subsequently entering requests.
The EU competition authority may OK the pact with or without conditions or choose to initiate a broader inquiry if serious concerns are raised. A timeline has not been suggested and neither party has commented on the development.
The Shazam app, which lets users identify a recording by pointing a smart phone at the song, has been downloaded more than a billion times since its commercial rollout in August 2002. An early version allowed users to “tag” a track by dialling a four-digital number on their handsets and pointing it toward the source of the music for roughly 30 seconds. Shazam then issued an SMS identifying the title and its performer.