The European Union’s antitrust watchdog isn’t yet ready to sign off on Apple’s Shazam acquisition.
The EU’s regulatory body, the European Commission, has launched an “in-depth investigation” into Apple’s pending purchase of Shazam to determine whether the acquisition will adversely affect music lovers and those who would prefer more choice for music streaming. The move also means Apple will need to wait longer to get an answer on whether it’ll be cleared to acquire Shazam: the European Commission has until Sept. 4 to make its decision.
“Our investigation aims to ensure that music fans will continue to enjoy attractive music streaming offers and won’t face less choice as a result of this proposed merger,” European Commission Commissioner Margrethe Vestager said in a statement.
Apple announced plans to acquire Shazam in December in a deal believed to be valued at $400 million. Shazam, which “listens” to audio playing in an ambient environment and identifies it for users, would likely be integrated into Apple’s streaming-music service Apple Music for that feature. Shazam also works with television shows and ads and could have a variety of other functions in Apple’s broader line of services.
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Apple’s Shazam acquisition is rather small in the broader tech industry, which makes the EU’s look into the buy rather unorthodox. The deal is small enough that it doesn’t require an automatic European Commission investigation. However, several EU countries, including Austria, France, and Italy, asked the European Commission in February to review the deal to ensure it didn’t run afoul of regulatory requirements.
In addition to announcing its “in-depth investigation,” the European Commission said on Monday that a “preliminary” evaluation of the acquisition revealed “several issues” that require a deeper dive.
“At this stage, the Commission is concerned that, following the takeover of Shazam, Apple would obtain access to commercially sensitive data about customers of its competitors,” the agency said in a statement. It added the data “could allow Apple to directly target its competitors’ customers and encourage them to switch to Apple Music.
“As a result,” the regulatory body continued, “competing music streaming services could be put at a competitive disadvantage.”
Apple did not respond to a Coins2Day request for comment on the European Commission’s decision.