Earlier this week, streaming service Pandora bought analytics company Next Big Sound earlier this week. Last year, Spotify made a similar move by purchasing the Echo Nest. With these acquisitions, these companies are prepping to gain an edge in an increasingly competitive ad market.
Why This Matters
In light of other recent deals — namely, Verizon acquiring AOL for $4.4 billion — increasing market attention has been devoted to adtech, where companies have sought automated ad sales for their publishers. For companies like Pandora and Spotify, it shows all too clearly that the companies are prioritizing ad servicing as the debate over royalties rages on.
This is a noisy chamber that’s only about to get noisier, as Spotify’s competitors have begun to target the company’s “free” servicing tier. Where artists fall into this seems to be an afterthought, given that the inter-company shit-slinging. Your move, Tidal!