Tuesday, 16 October 2018

Apple’s acquisition of Asaii reveals the company’s two-fold strategy to take on Spotify, after Spotify unveiled a new feature.
Last month, Asaii, a music analytics program, abruptly announced that it was shutting down.

In an e-mail to customers, the company wrote,

“Asaii will [shut] down operations on October 14, 2018. As of that date, you will no longer have access to our API endpoints, the website, or features such as Asaii Terminal, Recommend, Artist Analytics, and others. We’ve loved watching the artists you’ve signed, marketing campaigns you’ve launched, and love of bringing data into this industry you’ve shown over the past two years.”

The startup had offered artist managers and labels a music analytics platform for developing artists. Breaking down data from streaming music services as well as social media, the company’s technology could purportedly find “the next big Justin Bieber…10 weeks to a year” before they rise to fame.

Report has it that Apple purchased the music analytics startup for under $100 million. And, the move could help Apple Music better compete against Spotify.

The Spotify feature allows select indie artists to upload their music directly onto the streaming music service. Planning for a “perfect release day,” musicians can edit metadata with quick and simple edits. Along with “a clear report” of how much they earn per play, artists will automatically receive recording royalties in their bank account. Musicians also won’t face restrictions on frequency, file size, or quantity.

Spotify’s direct upload feature further bridges the gap between indie artists and streaming services. The move came months after the company revealed it would strike deals with indie musicians and management companies. Apple’s acquisition sees the company now competing directly with Spotify for indie artists.

Speaking about the acquisition, Cameron Baradar, founder of The House, the first company to invest in Asaii, explained,

“As the first investors in Asaii, we are incredibly excited by their recent acquisition by Apple where they will have the opportunity to dramatically scale their impact and continue building out their vision for the future of the music industry.”

That ‘future’ clearly involves discovering the next top indie artists. In fact, several Asaii staff members are now listed as Apple employees on LinkedIn.

But, don’t expect Apple to stop there.
Apple Music won’t just focus on working with indie artists. Asaii’s platform also provides managers and labels an effective recommendation algorithm based on listeners’ preferences.

Apple Music could use Asaii’s technology to better recommend music, thus competing with Spotify’s machine learning algorithm. In an interview earlier this year, Apple CEO Tim Cook blasted Spotify’s effective computer-generated playlists, stating,

“We worry about the humanity being drained out of music, about it becoming a bits-and-bytes kind of world instead of the art and craft.”

Apple’s acquisition could mark a reversal — or at least a slight modification — of Cook’s policy.

Meanwhile in London, Apple is buying a portion of chipmaker Dialog Semiconductor’s business.

Since the debut of the earliest iPhone, Apple has been using Dialog Semiconductor power management chips to help manage battery life in its devices.

On October 11th, Apple announced it is paying $300m in cash to buy a portion of London-headquartered Dialog’s business. As well as the initial outlay, the iPhone maker is also committing a further $300m to make licensing purchases from the remaining segments of Dialog’s business, making it a $600m deal.

Dialog will license certain power management technologies and will transfer some of its assets. It will also move 300 employees to Apple to support chip research and development. Apple is acquiring Dialog offices in Britain, Italy and Germany.

A close relationship
Many of the Dialog staff that are transferring have been working closely with the tech giant for years already. According to Reuters, the patents and people agreement is the largest of its kind by Apple, whose last major acquisition in this space was the $350m purchase of Face ID creator PrimeSense in 2013.

According to Dialog, the deal will not affect its 2018 revenue. It will continue to ship existing power management integrated circuits (PMICs) to Apple. After the deal, it is expected Apple will account for 35pc to 40pc of Dialog’s total revenues in 2022, which will be down from 75pc in the current year. The remaining part of Dialog’s business will focus more on storage, automotive, computing and storage markets, as well as IoT.

Senior vice-president of hardware technologies at Apple, Johny Srouji, said: “Dialog has deep expertise in chip development, and we are thrilled to have this talented group of engineers who’ve long supported our products now working directly for Apple.

The deal is expected to close in the first half of 2019, pending regulatory approvals. TechCrunch reported that Apple’s growing interest in VR and other hardware products means it needs to focus on power management and chip efficiency in the next few years.

“Our relationship with Dialog goes all the way back to the early iPhones, and we look forward to continuing this longstanding relationship with them.”

CEO of Dialog, Jalal Bagherli, said: “Going forward, we will have a clear strategic focus, building on our custom and configurable mixed-signal IC expertise and world-class power-efficient design. Our execution track record, deep customer relationships and talented employees give us great confidence in our future growth prospects.

“We believe that this transaction is in the best interests of our employees and shareholders, who will benefit from a business with enhanced focus, strong growth prospects and additional financial flexibility to invest in strategic growth initiatives.”

Additional credits: Reuters, Techrunch

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