Google Inc (NASDAQ:GOOGL) buying music streaming company Songza Media may be a social media play, Bruno Del Ama said in a conversation aired on Bloomberg Television.
Songza Media competes with the likes of Pandora Media Inc (NYSE:P) in providing a service to users that lets them compile a playlist either by searching for music or looking at suggestions based on past songs that were played. According to Bloomberg, the terms of the Google Inc (NASDAQ:GOOGL) and Songza Media deal have not been disclosed.
According to Bloomberg, Pandora Media Inc (NYSE:P) traded down a little because of the announcement. However, it has not had much effect on the stock price for Google. The deal comes after Apple Inc.’s (NASDAQ:AAPL) acquisition of Beats Electronics which also has a music streaming service and Amazon.com, Inc’s (NASDAQ:AMZN) announcement of its own music streaming service called Prime Music.
Meanwhile, asked whether his company, Global X Management, has an investment in Google Inc (NASDAQ:GOOGL), Del Ama said that they do. The Global X Management CEO explained: “We have a social media ETF. Google is one of the components of our social media ETF because a lot of their social media properties and this is obviously an acquisition and an addition to those properties.”
Furthermore, Del Ama added that what Songza Media has is an interesting business model. He said that not only does the company has a revenue stream from advertising but also from subscription fees and music sales. Del Ama said: “This is an interesting business model. It’s not only advertisement, it’s also subscriptions [and]there’s also the downstream actual purchase and distribution of music itself.” The CEO said that this is probably one of the most attractive aspects of the business down the line in terms of monetization for Google Inc (NASDAQ:GOOGL) which he said is trying to do more and more in the social media space.
The discussion which also touched on Amazon.com, Inc’s (NASDAQ:AMZN) new Fire Phone and music service can be seen below.
Google Inc (NASDAQ:GOOGL) investors includes Wallace Weitz’s Wallace R. Weitz & Co. which reported 56,880 shares in the company by the end of March. Another shareholder is Eashwar Krishnan’s Tybourne Capital Management which, also by the end of the first quarter, reported 52,400 shares in the internet search and advertising giant.