Shazam Raises $32 Million to Continue its Expansion into Interactive TV

Audio-based automatic content recognition (ACR) specialist, Shazam (note: the London-based company is best known for offering a mobile application that consumers can use to identify music, as well as TV shows and other content--a process it calls "tagging"), said Wednesday that it has raised $32 million in a funding round led by Kleiner Perkins Caufield & Byers and Institutional Venture Partners, with the participation of existing investor, DN Capital.

The company says that it plans to use the new funding to continue its expansion beyond its music roots into interactive TV, via its Shazam for TV offering (note: a demo video of Shazam for TV is embedded above), which allows broadcasters and advertisers to deliver interactive enhancements, supplemental information, coupons, product purchasing opportunities and more to viewers' smartphones when those viewers tag a program or commercial. The company touts Shazam for TV as allowing advertisers to offer a rich, interactive TV experience which--because it is delivered to a second screen--is also "unobtrusive." "Music is still at the core of our DNA and will always remain fundamental to who we are," Shazam CEO, Andrew Fisher, said in a prepared statement. "Our expansion into television is a natural evolution of our technology and we are excited to have delivered the same powerful discovery experience for broadcasting and advertising that people have always loved with music. Our size and growth is unparalleled in the industry and gives our network and brand partners reach not available with anyone else. This investment will support our continued growth, both organically and through acquisition, as well as the ongoing development of new features and products, keeping us at the forefront of innovation."

According to Shazam, the significant reach of its platform (it claims to have close to 150 million users, who perform 4 million tags per day, and says that it is adding 1.2 million new users each week, putting it on track to reach 250 million users within two years) is what has convinced NBCUniversal's Bravo, Oxygen and Syfy networks and MTV's Spike TV to incorporate Shazam for TV into their programming over the past few months. The company has also released a list of advertisers that have recently used the platform to enhance their commercials, including Honda, Starbucks, Paramount, Procter & Gamble and Progressive, and earlier this year, it partnered on a high-profile TV and in-store advertising campaign with Old Navy (see the article published on itvt.com, February 23rd). According to the company, Shazam for TV-powered advertising has so far proven very effective: "Shazamable ads drive more traffic," the company claims in its press materials. "In one ad campaign, Shazam drove 20% more traffic to the mobile microsite than the brand's Web site received from all sources. 0.3% of them Shazam'd the commercial, three times the average online click-through of 0.1%. 27% of the people who Shazam'd the ad either shopped, downloaded the song featured in the ad or viewed additional content."

In another sign of what appears to be increasing interest in the emerging ACR space, earlier this year rival IntoNow was acquired by Yahoo! for approximately $22 million just 12 weeks after its launch (see the article published on itvt.com, April 25th).

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