Semetric acquisition gives Apple a window on piracy

From clues on the ground — a change of corporate address, a new director who happens to be on Apple’s payroll — the British website Music Alley deduced Wednesday that Apple had acquired Semetric, one of a cluster of British music analytics start-ups whose cachet has grown with the industry shift from downloads to streaming.

A person “familiar with the transaction” told the Financial Times that Apple paid $50 million for Semetric and that most of its 40 employees are now working for Apple.

Apple is likely to “hoover up” Semetric’s vast pool of data into Apple’s Beats Music subsidiary in order to improve Beats’ song recommendations and force stronger connections with fans, industry analyst Alice Enders told the Financial Times‘ Robert Cookson.

Semetric is best known for its Musicmetric analytics service, which gathers data about what songs are hot by tracking music sales, streams, file sharing and chatter on social media. Its clients include Spotify, the market leader in streaming music.

The possibility of a battle between Beats and Spotify got most of the ink Wednesday. And rightly so. Apple under Steve Jobs had put all its chips on downloads and was caught off balance when the ground shifted. If the company were to offer its 800 million-plus iTunes subscribers a decent streaming service for less than Spotify’s $10 per month, it might give the market leader a run for its money.

What caught my eye, however, was a line in Semetric’s home page:

Each day, millions of fans make billions of interactions with content, social media, peer to peer networks and the web in general.” (emphasis mine)

Peer to peer networks — chief among them bittorrent — fly largely under the industry’s radar. Which is why Musicmetric’s Digital Music Index — which claimed to be the largest ever public data set showing trends in music on U.K bittorrent sites — made such a splash when it came out.

Semetric has since branched out into television, film, e-books and gaming — all media that have been heavily pirated.

If nothing else, the acquisition of Semetric could give Apple a window into the black hole that is sucking up, according the the Recording Industry Association of America, $12.5 billion per year worth of copyright music alone.

See also: Apple Just Bought This Startup to Help Take On Spotify

Follow Philip Elmer-DeWitt on Twitter at @philiped. Read his Apple AAPL coverage at or subscribe via his RSS feed.

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