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Old May 8, 2014, 05:02 PM   #1
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Apple in Talks to Acquire Beats Electronics for $3.2 Billion [Updated]




Apple is said to be close to completing an acquisition of Beats Electronics, the headphone company and streaming music service created by Dr. Dre and Jimmy Iovine. According to the Financial Times, the deal could be announced as soon as next week if negotiations work out.

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Apple will acquire Beats' streaming music service, which launched this year, and its audio equipment business, which includes its brand of headphones and audio equipment. The Beats management team will report to Mr Cook, said people familiar with the deal. Apple and Beats declined to comment.
Apple is said to be paying $3.2 billion dollars for the company, a sum that dwarfs the $404 million Apple spent to acquire NeXT in 1996, its largest purchase to date. As of its last earnings call, Apple had some $150 billion in cash on hand, plenty to cover the large acquisition.

Tim Cook said earlier this year that the company was open to making large acquisitions if the purchases made sense. "We have no problem spending 10 figures for the right company, for the right fit that's in the best interest of Apple in the long-term. None. Zero."

In addition to producing a range of popular premium headphones and speakers that Apple currently sells in its stores, Beats also recently launched its Beats Music service, a direct competitor to Spotify, Pandora, and Apple's own iTunes Radio service. Beats Music is, however, a subscription-based on-demand service, which could bolster Apple's free station-based iTunes Radio service.

The purchase of Beats Electronics comes as Apple has been rumored to be working on a complete overhaul of iTunes in order to address declining music sales. Part of Apple's revamp was said to include an on-demand streaming music service similar to Spotify, but the company may have elected to purchase Beats rather than designing its own service from the ground up.

Beats Music, which is available to subscribers for $9.99 per month, focuses heavily on curation. The company has hired music experts from popular radio stations around the country to create stations and playlists from the service's 20 million song catalog. It is unclear if Apple will keep the Beats Music format intact if it does indeed acquire the company, but the curation will fit well with the iTunes Music Store, which also offers music choices picked by Apple editors.

Apple and Beats Electronics have had an ongoing relationship, with Beats CEO Jimmy Iovine meeting with Tim Cook and other Apple executives about a possible partnership back in January of 2013. Iovine also reportedly pitched Steve Jobs on a streaming music service a decade ago, but Jobs passed on the opportunity.

According to the Financial Times, the deal is still in the works with some details yet to be ironed out, suggesting "talks could still fall apart."

Update May 8 3:30 PM PT: Bloomberg, The Wall Street Journal, and The New York Times have confirmed that Apple is in talks with Beats Electronics over a possible acquisition.

Update May 9 4:24 AM PT: A new video on Facebook (warning: NSFW language) posted by actor Tyrese Gibson (via The Next Web) shows Beats Electronics founder and musician Dr. Dre seemingly confirming the acquisition, however Apple and Beats Electronics have yet to speak on the potential purchase.

Update May 9 5:08 AM PT: The video featuring Dr. Dre seemingly confirming the acquisition has been pulled from Facebook, however it has since been reuploaded to YouTube by another source.

Article Link: Apple in Talks to Acquire Beats Electronics for $3.2 Billion [Updated]
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Old May 8, 2014, 05:03 PM   #2
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Am I the only one that's totally surprised by this? Seems pretty random. And pointless IMO.
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Old May 8, 2014, 05:04 PM   #3
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Why? Beats is terrible at audio. If it was Bose/Bowers & Wilkins then I wouldn't be so surprised.
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Old May 8, 2014, 05:04 PM   #4
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Great

Great! So we can get HIDEOUS thocky plastic hard sounding headphones that are trendy fashion accessories.

It instantly takes any mix you throw at it and makes it sound like a overcompressed horrific plastic thocking sound.
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Old May 8, 2014, 05:04 PM   #5
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You know, I was expecting more than one headphones designed Apple.

"Ive" been waiting for a larger selection of Apple designed headphones for quite some time.
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Old May 8, 2014, 05:04 PM   #6
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Oh, please, no.

Worthless acquisition.
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Old May 8, 2014, 05:04 PM   #7
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Quote:
Originally Posted by moeafg View Post
Why? Beats is terrible at audio. If it was Bose/Bowers & Wilkins then I wouldn't be so surprised.
Bose is not much better than Beats are :s
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Old May 8, 2014, 05:04 PM   #8
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Maybe Apple will include a pair of Beats with every iPod instead of earbuds
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Old May 8, 2014, 05:04 PM   #9
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WTF! I can't think of a worse brand to acquire. Their products are tacky-looking and don't sound as good as some of the other manufacturers like JBL, B&O and so on.

What are they thinking? The look of Beats products doesn't fit into Apple's design language at all.
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Old May 8, 2014, 05:05 PM   #10
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Why Apple why, out of all companies.
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Old May 8, 2014, 05:05 PM   #11
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Beats by Dr Cook
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Old May 8, 2014, 05:05 PM   #12
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Buying this crappy headphone maker would be silly.
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Old May 8, 2014, 05:05 PM   #13
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That's interesting. I always thought of them as a spin-off of Monster with a me-too streaming service. I'd like to know what makes them worth anything to Apple.

Maybe Tim just wanted to buy a dime bag and there was some confusion?

EDIT: It was wrong of me to post this. It's racist. I'm very sorry. Please don't up vote it.

Last edited by okboy; May 13, 2014 at 06:05 PM.
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Old May 8, 2014, 05:05 PM   #14
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My body is ready for Beats music service fused with iTunes Radio in iOS 8.
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Old May 8, 2014, 05:05 PM   #15
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Quote:
Originally Posted by aliensporebomb View Post
Great! So we can get HIDEOUS thocky plastic hard sounding headphones that are trendy fashion accessories.

It instantly takes any mix you throw at it and makes it sound like a overcompressed horrific plastic thocking sound.
Well... when you say it that way.. does sound like an Apple market.
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Old May 8, 2014, 05:05 PM   #16
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Originally Posted by XboxMySocks View Post
Bose is not much better than Beats are :s
Bose is a billion times better than Beats
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Old May 8, 2014, 05:05 PM   #17
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Wow!
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Old May 8, 2014, 05:06 PM   #18
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Does not seem like a good acquisition for Apple to do. Beats is all marketing and branding, areas that Apple has no obvious need for.
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Old May 8, 2014, 05:06 PM   #19
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Beats headphones are already over priced for their quality. Now we're going to maybe see an Ive-rendition of beats for even more money?? I'm not seeing the upside to this acquisition. Beats doesn't offer any ground breaking technology for audio quality, what's Tim thinking?
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Old May 8, 2014, 05:06 PM   #20
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Quote:
Originally Posted by aliensporebomb View Post
Great! So we can get HIDEOUS thocky plastic hard sounding headphones that are trendy fashion accessories.

It instantly takes any mix you throw at it and makes it sound like a overcompressed horrific plastic thocking sound.
Sound is pretty good imho, sure they are no B&W, Senheiser or JBL but they sound good, too much basses but this is the sound young users wants.
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Old May 8, 2014, 05:06 PM   #21
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This made me sick to my stomach. I REALLY don't think this is true… waaaaaaaay too much money for a junk brand. Apple knows better than to throw away that kind of cash. They didn't buy Waze for 1B, no way they buy this for 3.2.
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Old May 8, 2014, 05:06 PM   #22
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Originally Posted by XboxMySocks View Post
Bose is not much better than Beats are :s
Try out Bose's noise canceling headphones. The sound is better, as well as filtering out outside noises. Beats are known for their 'swag' and heavy bass.

Apple on the other hand is a luxury brand. I can't see swagalicious luxury go hand in hand.
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Old May 8, 2014, 05:07 PM   #23
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Have to agree with the general consensus here ... why? Seems rather pointless and way too much money for what they'd be getting. Hopefully this is one rumor that doesn't pan out.
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Old May 8, 2014, 05:07 PM   #24
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Hopefully this rumor is not true. Beats does not make good audio products. I take that back, a couple of their headphones are good but most are objectively terrible.
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Old May 8, 2014, 05:07 PM   #25
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I'm not saying I think this is the best idea, but why are people only thinking about the headphones/earphones?

To me, this is a clear play at their streaming service and audio technologies. Nothing (necessarily) to do with the actual headphones/earphones.
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