Shazam no longer makes money on its own: Apple bought it in September 2018 and said the app would become ad-free for all users. Today Shazam works as a free discovery funnel for Apple’s services, above all Apple Music, and as a feature built into iPhone, Mac and Apple Watch. Founded in 2000 and launched in 2002 as a UK SMS service, Shazam passed 100 billion song recognitions in November 2024.
As an independent company, Shazam ran ads in its app, which Apple's 2018 release said would soon become ad-free for all users, and referred users to music streaming services.
The European Commission, reviewing the deal, noted that Shazam refers users to music streaming services and that Apple Music was Europe's second-largest streaming service after Spotify.
03
A built-in feature
Shazam's recognition is built into iOS and macOS as Music Recognition, into the Action button on recent iPhone and Apple Watch models, and into the watchOS Smart Stack.
04
Data on what people want to hear
Every recognition is a signal about demand. Shazam uses it to track trends and publishes lists such as its Top 100 songs and yearly predictions of breakout artists.
Where you see it today
100 billion recognitions
In November 2024 Apple said Shazam had passed 100 billion song recognitions since launch and had over 300 million monthly active users. Its most identified song ever, “Dance Monkey”, had over 45 million tags.
The regulator's view of data
The European Commission cleared the deal on 6 September 2018 after an in-depth review of whether Shazam’s user data would let Apple target rival streaming customers. It concluded that Shazam’s data was not unique and that competition would not be harmed.
Apple’s 10-K does not break out Shazam; it sits inside Services, which earned $109.2 billion in Apple’s fiscal 2025, up 14%, out of total net sales of $416.2 billion.
Machine listening before the AI boom
Shazam’s core is audio fingerprinting: a 2003 paper by Shazam’s Avery Wang describes hashing time-frequency ‘constellations’ so a short, noisy phone recording can be matched against over a million tracks in milliseconds (Wang, 2003). Recognition now also runs inside apps and through headphones.
Shazam, then and now
2002
OwnerShazam Entertainment
How it made moneyUK SMS service: dial 2580, get the song name by text
2008 onward
OwnerShazam Entertainment
How it made moneyiOS app; ads and referrals to streaming services
September 2018
OwnerApple
How it made moneyAcquisition completed; app to become ad-free for all users
2024-26
OwnerApple
How it made moneyFree feature across Apple devices; funnel to Apple Music and Services
What it means for you
If you build a free tool, ask who benefits most from the intent it captures; Shazam's value grew as a front door for a subscription service.
Treat usage data as an asset regulators will look at, as the European Commission did with Shazam.
For artists and labels, Shazam counts are an early demand signal worth tracking.
For product teams, distribution beats features: Shazam spread by becoming a button in the operating system.
Do not expect a revenue figure for Shazam; Apple reports it inside Services.
The Business Engineer lens
Shazam shows how a standalone app turns into a feature once a platform owns the device and the subscription. The Business Engineer reads the AI era the same way: recognition and assistant features get absorbed into the operating system, and value moves to whoever owns the subscription behind them.
It no longer sells ads; since Apple's 2018 acquisition it is a free feature that sends listeners to Apple Music and supports Apple's Services business.
Who owns Shazam?
Apple, which completed the acquisition on 24 September 2018 after EU approval on 6 September 2018.
How many people use Shazam?
Apple said in November 2024 that Shazam had over 300 million monthly active users and had passed 100 billion song recognitions.
How does Shazam recognise songs?
It turns a short recording into an audio fingerprint of time-frequency peaks and matches it against a large database of tracks.
The complete explainer, cleaned up and reformatted for mobile.
Shazam is a music, movie, advertising, and television show recognition app created in 1999 by Chris Barton, Philip Inghelbrecht, Avery Wang, and Dhiraj Mukherjee, as a service to recognize songs. In 2018, Shazam was acquired by Apple — as explored in the interface layer wars reshaping consumer tech — in a deal worth $400 million. Before Apple acquired the company, Shazam made money by selling advertising spots to other businesses.
History of Shazam
Shazam is a music, movie, advertising, and television show recognition app.
FourWeekMBABusiness EngineerAt a glance
In 2018, Shazam was acquired by Apple — as explored in the interface layer wars reshaping consumer tech — in a deal worth $400 million.
Today, Shazam searches a database of approximately 30 million songs and can identify a track in around two seconds.
After the Apple acquisition, the collection of referral fees became limited to iTunes.
Operating for over 20 years and with 20 million searches per day, the platform likely has a vast amount of data on user media content preferences and selections.
Layout refreshed 6 October 2026. The article text below is unchanged.
Why it mattersFrom the article
An indirect source of revenue for Shazam and Apple lies in user data.
Shazam's competitive advantage lies in its pioneering music identification technology, user-friendly app interface, extensive database, and integration with music and media platforms.
It was created in 1999 by Chris Barton, Philip Inghelbrecht, Avery Wang, and Dhiraj Mukherjee. Smartphones and music services such as iTunes had yet to be invented, and Barton lamented that he could never recognize the songs he heard on the radio.
With Mukherjee, he had the idea to partner with radio stations to identify songs on air and sell music to listeners.
Early versions of Shazam required users to call a number and hold the phone close to the radio to receive a text identifying the song. Shazam had over 1 million songs in its database by 2002, but a lack of technology meant song identification was slow and cumbersome.
Nevertheless, the founders tried various business models over the ensuing years. For a while, Shazam made money through reverse charge text messages. It also made deals with ringtone companies and mobile handset manufacturers.
Venture funding then became difficult to source as the platform continued to grow in the wake of the dot-com recession.
Today, Shazam searches a database of approximately 30 million songs and can identify a track in around two seconds. The app can also handle remixes, cover-band versions, and background noise.
Shazam revenue generation
Before the company was acquired by Apple, Shazam made money by selling advertising spots to other businesses. It also offered a premium version of the app called Shazam Encore.
Advertising in particular was a significant source of income for the company, making it profitable for the first time in 14 years. Despite this, Apple decided to remove advertising from Shazam in late 2018. In 2020, the premium app was also made free.
So how does it make money? Read on to find out.
Digital sales
When a user identifies a song on Shazam, they have the option to purchase it on iTunes.
After the Apple acquisition, the collection of referral fees became limited to iTunes. Revenue has probably also suffered because of the general decline in digital music purchases over the last decade.
User data
An indirect source of revenue for Shazam and Apple lies in user data.
Operating for over 20 years and with 20 million searches per day, the platform likely has a vast amount of data on user media content preferences and selections.
How Apple plans to monetize this information is open to interpretation. It may for example use this data to determine what sort of content is produced for the Apple streaming service Apple TV.
Alternatively, Apple may already sell the data in aggregated, anonymized form to interested parties. These include record labels, artists, television directors, and music or movie production companies.
FourWeekMBABusiness EngineerTimeline, as stated in the article
2002
Shazam had over 1 million songs in its database by 2002, but a lack of technology meant song identification was slow and cumbersome.
2016
In 2016, Shazam gave users the option to play songs on Spotify and other streaming services.
2018
In 2018, Shazam was acquired by Apple in a deal worth $400 million.
2020
In 2020, the premium app was also made free.
Key takeaways
Shazam is a media recognition app developed by Chris Barton, Philip Inghelbrecht, Avery Wang, and Dhiraj Mukherjee in 1999. Barton was inspired to create the app to help users identify songs they heard on the radio.
Before being acquired by Apple, Shazam was a profitable company thanks largely to advertising revenue. The premium version of the app, Shazam Encore, was also made free after the acquisition.
Shazam makes money via digital sales, encouraging users to purchase the songs they heard on iTunes. The company may also sell vast stores of user data to interested parties.
Business Model Element
Analysis
Implications
Examples
Value Proposition
Shazam’s value proposition revolves around its music and media recognition capabilities. Key elements of its value proposition include: – Music Identification: Instantly identify songs by listening to a short audio clip. – Media Discovery: Discover details about movies, TV shows, and advertisements. – User-Friendly: Easy-to-use mobile app with a simple tap-to-identify interface. – Cross-Platform Integration: Seamlessly integrated with various music and streaming platforms. Shazam aims to enhance users’ entertainment experiences by helping them discover and engage with media content effortlessly.
Offers a unique and convenient solution for identifying music and media. Simplifies the process of discovering songs, movies, TV shows, and advertisements. Appeals to users seeking an easy-to-use, cross-platform tool for media recognition. Enhances user engagement and music discovery. Integrates with popular streaming platforms to provide a seamless experience. Empowers users to explore and interact with media content.
– Instant music identification through audio clips. – Discovering details about movies, TV shows, and ads. – User-friendly, tap-to-identify interface. – Seamless integration with music and streaming platforms. – Enhancing user engagement and media discovery. – Empowering users to explore and interact with content.
Customer Segments
Shazam serves a broad range of customer segments, including: 1. Music Enthusiasts: Individuals who want to identify and discover new songs. 2. Entertainment Lovers: Those interested in finding details about movies, TV shows, and ads. 3. Advertisers: Companies and marketers seeking insights into ad effectiveness. 4. Music and Media Industry: Professionals looking for data and trends in the music and media sectors. Shazam caters to users with diverse entertainment and information needs.
Focuses on a diverse user base with varying interests and needs. Customizes its services to cater to music enthusiasts, entertainment lovers, advertisers, and industry professionals. Provides valuable insights for advertisers and the music/media industry. Serves as a versatile tool for music discovery, entertainment information, and marketing analysis. Engages with a broad audience of users.
– Serving diverse customer segments broadens the user base. – Customizing services for different entertainment and information needs. – Providing valuable insights for advertisers and industry professionals. – Serving as a versatile tool for music discovery and entertainment information. – Engaging a broad audience of users.
Distribution Strategy
Shazam’s distribution strategy relies primarily on its mobile app, available on various app stores. Users can download and install the app on their smartphones, enabling them to access its music and media recognition features. Additionally, Shazam’s technology is integrated into various streaming platforms and music apps, further extending its reach to users. The app is promoted through app stores and partner integrations.
Utilizes its mobile app as the primary distribution channel, ensuring accessibility for users. Extends its reach by integrating its technology with streaming platforms and music apps. Promotes the app through app stores and strategic partner integrations. Prioritizes ease of access and cross-platform availability.
– Mobile app serves as the primary distribution channel. – Integration with streaming platforms and music apps extends reach. – Promotion through app stores and strategic partners enhances visibility. – Prioritizes ease of access and cross-platform availability.
Revenue Streams
Shazam generates revenue through advertising, affiliate partnerships, and music discovery features. Its primary revenue streams include: 1. Advertising: Displaying ads to users of the app. 2. Affiliate Partnerships: Earning commissions from referrals to music and media platforms. 3. Music Discovery Features: Promoting music sales and streaming through song identification. Shazam’s revenue is derived from advertising to its user base, earning commissions from referrals to music and media platforms, and facilitating music sales and streaming.
Relies on advertising revenue generated by displaying ads to users of the app. Earns commissions through affiliate partnerships by referring users to music and media platforms. Promotes music sales and streaming by facilitating song identification. Prioritizes revenue streams related to its core music recognition and media discovery functionalities. Utilizes a combination of advertising, partnerships, and music promotion for income.
– Advertising revenue from displaying ads in the app. – Earning commissions through affiliate partnerships. – Promoting music sales and streaming through song identification. – Prioritizes revenue streams related to core functionalities. – Utilizes advertising, partnerships, and music promotion for income.
Marketing Strategy
Shazam’s marketing strategy includes in-app promotions, partnerships with music platforms, and word-of-mouth marketing. The app promotes its features to users within the app, encouraging them to explore and engage with its music identification and media discovery functionalities. Shazam collaborates with music and media platforms to expand its user base and reach. Additionally, satisfied users often recommend the app to others, contributing to word-of-mouth marketing.
Utilizes in-app promotions to encourage user engagement with music identification and media discovery. Collaborates with music and media platforms to expand its reach and user base. Benefits from word-of-mouth marketing as satisfied users recommend the app to others. Prioritizes user engagement and partnerships for growth and visibility.
– In-app promotions encourage user engagement. – Collaborations with music and media platforms expand reach. – Word-of-mouth marketing from satisfied users is valuable. – Prioritizes user engagement and partnerships for growth and visibility.
Organization Structure
Shazam operates as a technology company with a focus on music and media recognition. Its organizational structure includes teams dedicated to technology development, partnerships, marketing, and user experience. Technology development teams work on enhancing the app’s recognition capabilities. Partnerships teams collaborate with music and media platforms. Marketing teams promote the app’s features. User experience teams ensure a seamless and user-friendly interface. This structure supports innovation and partnerships.
Employs specialized teams for technology development, partnerships, marketing, and user experience. Prioritizes technology enhancement to improve recognition capabilities. Collaborates with music and media platforms to expand the user base. Promotes the app’s features through effective marketing efforts. Ensures a user-friendly interface for a seamless experience. Supports innovation, partnerships, and user satisfaction.
– Specialized teams focus on technology enhancement. – Collaborates with music and media platforms. – Promotes app features through marketing. – Ensures a user-friendly interface for a seamless experience. – Supports innovation, partnerships, and user satisfaction.
Competitive Advantage
Shazam’s competitive advantage lies in its pioneering music identification technology, user-friendly app interface, extensive database, and integration with music and media platforms. Pioneering Technology: Offers advanced audio recognition technology for accurate identification. User-Friendly Interface: Provides a simple and intuitive interface for users. Extensive Database: Maintains a vast database of songs and media content. Integration: Seamlessly integrated with popular music and media platforms. Shazam stands out as a reliable and user-friendly solution for music and media recognition.
Derives a competitive advantage from: – Advanced audio recognition technology for accuracy. – Simple and intuitive user interface. – A vast database of songs and media content. – Seamless integration with music and media platforms. Stands out as a reliable and user-friendly solution for music and media recognition.
– Advanced audio recognition technology for accuracy. – Simple and intuitive user interface. – A vast database of songs and media content. – Seamless integration with music and media platforms. – Stands out as a reliable and user-friendly solution for music and media recognition.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
The Business Engineer readApple's Edge Moat & the AI Frontier GapThe mistake almost every Apple-AI analysis makes is to score the company against the foundation-model leaderboard — Apple Intelligence vs.Read on businessengineer.ai →
