Making technology simple

Shazam’s story

We caught up with Andrew Fisher, CEO of Shazam, to find out more about their innovative music discovery technology, how you drive a digital brand in the twenty first century and why smartphones have changed the way we listen to and buy music.

Finding the music you need

Shazam’s mobile app allows people to find out the artist and title of any published music recording. How does the technology actually work?

“Shazam works on what we call ‘fingerprinting’ or pattern recognition. It’s taking a sample of the song, creating a pattern and matching that pattern with the songs that we have on our database.”

What were people’s reactions when you first introduced the technology?

“People were amazed. Shazam has always had this magical experience associated with it - it’s the genie in the box. What it’s doing is helping someone to find a piece of music they like, buying that music and sharing that experience. Within a five to ten second experience, we’ve taken the sample and matched it against our database of 10m published recordings.

The mobility factor is also really important - that’s why it’s what we call it a made-for-mobile service. People tend to hear music when they’re out and about and buying music can be a very impulsive experience.”

Mobile makes it easier

When you first took over as CEO in 2005 there were no smartphones and no tablet devices. Did you have to wait for technology to catch up with the idea of Shazam?

“Shazam was a technology ahead of its time and that’s a consideration for a lot of start-up businesses that are using technology. Three years into the business, we recognised that there were some macro factors that were going to affect our success. Those were: people buying digital content through online music providers; unlimited data tariffs; and pricing parity. Once all those macro factors were in place, that massively influenced the success of Shazam.”

You now have 150 million users of the Shazam app, across multiple platforms. With the app itself being free, where do the main revenue streams come from with this business model?

“The app is free at the entry level, but there’s a premium component to the service. The reason we have a hybrid model is because of the state of the mobile advertising market. You’ll see that change over time - ultimately, Shazam’s mission is to be become ubiquitous and be the world’s leading search service on mobile. To achieve that, being able to give free access to the service is really helpful.

As the mobile advertising market matures over time we’ll drive a high proportion of our revenues through selling advertising. The other important revenue stream for us is selling content, such as music.”

The freedom of private ownership

Shazam is still a privately-held company. What strengths do you think being a private company brings to the way you do business?

“It really means that we can invest in the opportunity as it develops. We’re in a rapidly developing world in terms of changing consumer behaviour - just look at what’s happened with social networking over the past two years.

People are changing their behaviour faster than ever before. What’s really important for us, from an investment perspective, is that we can pursue the opportunities when we need to. We don’t have to manage a public market sentiment or run the business on a quarterly or six-monthly cycle. If we need to invest very heavily and it has an impact on our operating results, we can do that. That’s a huge benefit for us.”

Where do you see Shazam in ten year’s time?

“We aim to be the service of choice for people who want to discover products and services on a global basis. So our ambition is to become a ubiquitous service worldwide with over 1bn users. In ten years time, we’d hope to be part of a large proportion of the global population’s everyday lives.”

You’ll be able to read the full version of this article, with more of Andrew’s insights into the mobile technology market, in the November edition of our Private Business magazine.

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