Following rumors surfacing at the beginning of last month, Google has announced today that it will acquire music streaming service Songza for an undisclosed sum.
Songza, founded in 2007, is one of the smaller players in the highly competitive music streaming industry, with about 5.5 million active users, a part of whom are paying $0.99 per week for the premium ad-free service. The tiny user base – compared to giants like Pandora and Spotify – explains the relatively small price that Google is reported to have paid for the startup, $15 million. However, TechCrunch reports that Songza was in discussions with other suitors besides Google, which may have inflated its price to some extent. The Songza team will join Google’s New York team, and the service will continue to function unchanged for the near future.
What’s Google’s interest in Songza? Google already has a strong music product in Play Music and plans to offer a YouTube music streaming service by the end of the year. However, Songza could help improve Google’s streaming radio features, and especially the curation element, which is one of Songza’s strongest points.
Songza employs expert curators that assemble playlists based on a variety of criteria, and Google could use that expertise to improve the quality of curation on Play Music and YouTube. Songza’s data trove, consisting of information on user preferences based on location, time of day, and other aspects, is likely another asset that piqued Google’s interest.