Rumor Mill: Apple Grabs Yet Another Music Co? - Analyst Blog
After the acquisition of Semetric last month, rumors hint to the fact that Apple Inc. (AAPL) has made another major move in the digital music industry. Per a report from MacRumors, the tech bellwether has acquired the UK-based digital audio effects creator, Camel Audio.
According to corporate registry information from Companies House, the address of Camel audio has reportedly been changed to the London office of Apple Europe Limited. Furthermore, the company’s sole directorship is now held by Heather Joy Morrison, key counsel at iTunes. These facts suggest that Camel Audio has indeed been acquired by Apple.
Alchemy softsynth maker Camel Audio was shuttered in January for unknown reasons. Now, it seems that the imminent acquisition by Apple was the probable reason behind.
Why the Move?
Of late, Apple has been eying the music streaming industry. The company has not only been making strategic acquisitions but is also keen on gathering ‘talents’ in the field. Having already hired DJ Zane Lowe (of BBC Radio 1 fame), iTunes is on a lookout for music journalism experts to develop editorial content in the domain.
In 2014, Apple, in one of its biggest deals, took over the popular Beats Electronics for about $3 billion. Beats Electronics, founded by the rapper-producer Dr. Dre and music producer Jimmy Iovine, is popular for its “Beats by Dr. Dre” headphones. Presently, in addition to providing sophisticated hardware including headphones and earphones, Beats also offers Beats Audio (a novel software technology) and Beats Music (a streaming music subscription service).
In fact, Beats Music has gained significant popularity owing to the company’s aggressive marketing strategies and promotion by celebrities such as Ellen DeGeneres. Beats’ partnerships with the likes of AT&T (T) and Target (TGT) also marked a positive.
Thereafter, in another calculated move, Apple acquired the music analytics company, Semetric. Media reports state that Apple also acquired Musicmetric in 2014. Musicmetric specializes in providing analytics services which offer deeper insights on record labels and artists, and also tracks the digital consumption of music by users. Additionally, the company is capable of offering similar services for tracking other media, including e-books, movies, games and TV shows.
The latest buzz is that Apple has been developing a paid streaming music service, leveraging the strength of Beats Music. Yet some reports also speculate on the possibility of Apple enhancing its existing Logic Pro X software on the back of this acquisition. Logic Pro is a recording studio for professional musicians and even ‘garage bands.’
To Conclude
All these acquisitions and hiring activities suggest that Apple has something big planned for the music industry. However, in the absence of any official information, one can only speculate.
Nonetheless, if this Zacks Rank #2 (Buy) company eventually develops something for the music streaming market, it will make life difficult for companies like Spotify and Pandora (P).
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