Google acquired Songza, a music streaming service notable for its context-sensitive playlists. For the moment Google has decided not to make any changes to the service.
Google likely made the acquisition in order to improve All Access, the music streaming service integrated into Google Play Music. YouTube is also a potential platform for some Songza features, as it recently announced a subscription-based music streaming option of its own.
"We can't think of a better company to join in our quest to provide the perfect soundtrack for everything you do," says Songza in a statement. "No immediate changes to Songza are planned, other than making it faster, smarter, and even more fun to use."
Songza's primary claim to fame is its advanced 'curation' methods, by which it attempts to deliver playlists to users based on factors like time of day or weather. Songza also offers playlists geared specifically toward specific activities, such as work, study, or exercise.
"They've built a great service which uses contextual expert-curated playlists to give you the right music at the right time," says Google in a statement.
The price of the acquisition was not officially disclosed, but unofficial sources say Google paid more than $39 million. That price pales in comparison to Apple's $3 billion acquisition of Beats, but much of that price was due to the company's popular brand of headphones rather than its streaming service. Google's acquisition price means Songza has more than tripled the initial $12 million it received from investors. Songza has expanded its user base quickly. The company was launched in fall 2011, and reported 5.5 million regular users at the end of 2013.
Although 5.5 million users falls well short of Pandora's 75 million users and Spotify's 10 million, it still represents a significant portion of the streaming market, and with Google behind it that share may increase in the coming months. The music streaming competition is still wide open, and it's not clear which companies are going to come out on top. However, most analysts believe that over time services will consolidate or die out, leaving only a few left.
"This is a business that will be a global scale business and I think there will be handful of survivors at the end of the day," says CEO Lew Dickey Jr. of Rdio. "I believe the digital music space today is very nascent. I liken it to the Myspace phase of social. I don't think it's clear who the winners are going to be."
