Spotify Acquires the Echo Nest

Music streaming service Spotify has acquired music intelligence platform the Echo Nest, whose song recommendation technology has long been utilized both by Spotify and a number of its competitors, the two companies announced today. Financial details were not disclosed.

The Massachusetts-based Echo Nest, founded in 2005, uses data analysis and machine listening to power song recommendation, audio fingerprinting and audio analysis. Spotify, which uses the Echo Nest to power its radio function, integrated its API with the Echo Nest’s back in 2012.

The Echo Nest noted on its company blog that its “API is staying up,” and is therefore still available to developers and the hundreds of apps that use it, while Spotify clarified that the Echo Nest would continue to honor all of its existing contractual obligations.

Nonetheless, the acquisition raises questions about the future of some of the Echo Nest’s existing deals with Spotify’s direct competitors, such as Clear Channel’s iHeartRadio, Rdio and Vevo. (Other streaming services, like Pandora and the newly launched Beats Music, use their own proprietary recommendation engines.) For Spotify, which closed a $250 million funding round last fall, the acquisition gives the company a stake in what has become an increasingly ubiquitous digital music tool, as well as diversifying its revenue sources.

“Since founding the Echo Nest, Brian Whitman and Tristan Jehan have created a company completely and beautifully obsessed with understanding the world of music to help fans discover more music,” Echo Nest CEO Jim Lucchese said in a statement.  “Joining forces with Spotify gives us the opportunity to continue doing so as part of the fastest-growing service in the world.”

The Echo Nest will remain at its current headquarters in Somerville, Mass.

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