Smule builds social music app empire by buying Khush

Smule, the successful iOS (s aapl) music app start-up behind Ocarina, Magic Piano and I am T-Pain, is making its first acquisition. On Thursday, Smule bought fellow social music start-up, Khush, in a bid to take command of what it believes will be a fast-growing mobile musical expression market. The purchase of Khush, known for its popular Songify and LaDiDa apps, is mostly through stock and some cash and will keep the Atlanta-based start-up in its home city, where it will continue to put out new apps alongside Palo Alto-CA based Smule.

The acquisition puts Smule in the driver’s seat of a new opportunity in mobile music as people move from consuming to increasingly creating their own music through mobile apps. Just like consumers are now sharing more and more creative pictures through Facebook and Instagram, they are growing more comfortable expressing themselves through music apps that make song creation easy and accessible. Smule and Khush’s customers together have downloaded almost 30 million apps and created more than 350 million songs.

Smule’s Magic Piano and Ocarina apps, which help users play pianos and flutes through their mobile devices, have been downloaded six million times each while Khush’s Songify app, which takes people’s spoken words and turns it into catchy songs, has been downloaded five million times. The companies have been competitors in a way but have also partnered previously, helping cross promote their apps.

Jeffrey C. Smith, co-founder of Smule said the combination makes a lot of sense. Both companies share an academic background with Smith and co-founder Ge Wang coming out of Stanford University’s Center for Computer Research in Music and Acoustics (CCRMA) while Khush co-founder Dr. Parag Chordia is a professor of computer music at Georgia Tech and serves as the director of the Georgia Tech Music Intelligence Lab. But more importantly, the two companies have taken a similar “odd” approach to music, making it fun, bizarre and entertaining.

“We’re almost like sister companies. This is a company that shares a common vision with Smule, believing people have creative potential. We believe we can get to 1 billion people creating music,” Smith told me in an interview.

Smith said the combination is almost necessary to stay at the head of this burgeoning market. He said the winners will be companies that have a large user base and a network to drive growth. Khush will connect its apps to Smule’s Sonic Network, a social layer that helps users create and share music together.

Ultimately, they’re hoping to build what they believe can be the “YouTube of music in mobile,” said Chordia. He said the key is that connected mobile devices are unlocking musical creativity that is greater than what you see on the web alone.

“We find the usage and engagement on mobile is different. Mobile is a personal device. You can whip it out at any time and people feel much more expressive with a mobile device because it’s like an instrument,” Chordia said.

Smule co-founder Jeffrey Smith, Khush co-founders Prerna Gupta and Parag Chordia

Both companies are looking at big launches of new products in the coming weeks. Khush is about to introduce a holiday-themed app that explores more visual elements while Smule will build upon its success with Magic Piano by going deeper with a new genre.

I think this is a good marriage and it highlights something that is really special about mobile. Smartphones and tablets are actually becoming very interesting content creation devices and they’re getting people to explore their creativity because they’re very simple and easy to use and sharing is so quick. I think other companies will be looking in this direction including gaming companies that will enable more creation tools and music companies looking to engage more with users. But I think Smule and Khush have proven they have a very clear vision of how to empower musical creativity and together, they will help that trend flourish even more.

What would a marriage of two musical start-ups be without a music video. Check it out: