Shazam’s audio app enables people to discover and share music, TV shows and ads. The app is available on Windows Phone, Android and iOS platforms. It is available on iPads, iPhones and iPod touch, as well as Windows 8 and BlackBerry.
Shazam’s voice recognition app helps users identify songs they have heard, but do not know the names. The company has extended its audio app business to TV. It now recognizes audio from television shows and ads on 160 TV channels in the United States, and can provide extra details on cast members or special offers from the advertisers.
Is this the next big thing in TV advertising?
Forbes reports that there is a probability Slim Helu sees potential to make advertisements on America Movil SAB de CV (ADR) (NYSE:AMX)’s TV channels more engaging. However, this might prove to be a huge challenge for the company. Right now, it is difficult to tell the percentage of its subscribers or monthly active users that use its TV related services.
Following America Movil SAB de CV (ADR) (NYSE:AMX)’s investment, Shazam CEO Rich Riley said, “It’s such a natural fit because America Movil SAB de CV (ADR) (NYSE:AMX) is the leading wireless carrier in Latin America. They understand mobile very deeply and it helps them understand Shazam.” So what exactly does America Movil SAB de CV (ADR) (NYSE:AMX) know about Shazam that we don’t?
Perhaps some believe that the mobile wave might have created an opening to making TV ads more engaging. The TV is also revolutionizing with smart TV set to dominate the television industry globally.
Therefore, from a different perspective, you could easily say that, yes, Shazam could be starting something big. However, what about Google Inc (NASDAQ:GOOG)’s voice search and Apple Inc. (NASDAQ:AAPL)’s Siri? Are they not able to perform the same task?
Well, both Google Inc (NASDAQ:GOOG) voice search and Apple Inc. (NASDAQ:AAPL)’s Siri are more like search software, while Shazam, has a sharing capability. Shazam has a social sharing aspect, while Apple Inc. (NASDAQ:AAPL)’s Siri and Google Inc (NASDAQ:GOOG) voice search are more personal assistant services.
For instance, with Siri, one can easily find nearby restaurants, get directions and directions from his or her current location. The same applies to Google Inc (NASDAQ:GOOG) voice search, whereby, apart from using the feature to perform normal search, a person can search places on Google Inc (NASDAQ:GOOG) maps.
Both Google Inc (NASDAQ:GOOG) voice search and Apple Inc. (NASDAQ:AAPL)’s Siri could be considered as a works in progress, mainly because, as far as their use is concerned, there is still too much to explore. For instance, integrating Google voice with Google+ to support audio sharing, puts more pressure on Shazam.
Apple Inc. (NASDAQ:AAPL)’s Siri and Google’s voice search could be used effectively to boost other units of the companies’ businesses. The advances in technology are trying to limit the level of contact between users of smart devices and the devices themselves. Therefore, both Google’s voice search and Apple Inc. (NASDAQ:AAPL)’s Siri could become integral features of the companies in the future.
Having noted the competition, do the benefits outweigh the risks for Slim?
Shazam has a database of 30 million music tracks and TV shows. The company says it has a user base of 350 million, with 100 million of those located in the U.S. However, only about 20% of these users, that is 70 million, use the service every month. In the case of U.S users, the percentage is just 17%, or 17 million monthly active users, or MAUs.
The company has already attracted $104 million in venture capital funding from DN Capital, Kleiner Perkins and Institutional venture Partners. Its affiliate music sales generated a revenue of $300 million for the last 12 months. This seems like decent revenue for the company given it is still in its early stages of development, while the market potential continues to widen.
