Apple Impressed by Beats' Ability to Attract Paid Subscribers, Likely to Keep Brand Separate

Discussion in ' News Discussion' started by MacRumors, May 12, 2014.

  1. MacRumors macrumors bot


    Apr 12, 2001

    Music industry veteran Jimmy Iovine is believed to be the primary target in Apple's rumored acquisition of Beats Electronics, but the company also is eyeing Beats' streaming music service and the Beats branded headphone business, reports Bloomberg. Apple likely will assume leadership of the company, but keep the Beats brand independent.

    Beats co-founder Iovine previously pitched the idea of a streaming music service to both Steve Jobs and Tim Cook, but neither party showed interest until the streaming music service launched earlier this year.
    Beats Music could fill a gap in Apple's music portfolio, which now offers digital downloads via iTunes and iTunes Radio, a channel-based music streaming service akin to Pandora. Though still a leader in the music download arena, iTunes is losing ground to full-library streaming music services like Spotify, which is poised to overtake iTunes as Europe's largest online digital music service.

    Besides the music service, Apple also will obtain a high-margin headphone business co-founded by rap musician Dr. Dre, Iovine, and early partner Monster cable. As part of the acquisition, Beats will likely remain an independent brand with Apple providing design improvements for future Beats products.

    Both Iovine and Dre may take on senior roles at Apple following Apple's acquisition, remaining at Beats' Los Angeles headquarters and traveling to Cupertino when necessary. Iovine is expected to leave his role as chairman of Interscope Geffen A&M records and use his music industry experience to help Apple secure future deals with music labels.

    Article Link: Apple Impressed by Beats' Ability to Attract Paid Subscribers, Likely to Keep Brand Separate
  2. 6825924 Suspended

    Aug 13, 2012
    Sounds good to me
  3. OS X Dude macrumors 6502a

    OS X Dude

    Jun 30, 2007
    So, my post on the matter could very well be right :D
  4. losthorse, May 12, 2014
    Last edited: Jul 15, 2014

    losthorse macrumors member

    Nov 19, 2012
  5. spyguy10709 macrumors 6502a


    Apr 5, 2010
    One Infinite Loop, Cupertino CA
    It wouldn't make sense for Apple to buy a brand for 3+ BILLION dollars, then get rid of the brand. Lets be honest, Apple's buying Beats for the name, not the tech or anything like that... So getting rid of the brand would be HIGHLY illogical. Would be cool to see Beats EarPods, though. I think with Apple's involvement, they could release a comfortable, balanced sounding set of headphones that look really good!
  6. Razeus macrumors 601

    Jul 11, 2008
    The Beats brand name is too strong to get rid of it.
  7. lolkthxbai macrumors 65816


    May 7, 2011
    That quote was unnecessary...

    If this is true, then maybe the deal was not as mysterious as people thought.
  8. chriscrk macrumors 6502


    Nov 14, 2011
    If people think this acquisition is stupid just because they don't like the headphone quality, they fail to realise the bigger picture, and they are real bozos.
  9. cmChimera macrumors 68040


    Feb 12, 2010
    You're sooo funny and original.
  10. Fzang macrumors 65816


    Jun 15, 2013
    Why are we still discussing this as if it's already happened? I know this is MacRumors but at least we can discuss iPhone 6 rumors without saying "Yup, this is exactly how it's going to look like 4 months time. No doubt about it".
  11. Jack Delgado macrumors regular

    Jack Delgado

    May 11, 2012
    What kind of crappy variant of the logo is that?

    Edit: Apologies... that's apparently the official Beats Music logo. Err... not a fan I spose.
  12. anradu macrumors newbie

    May 12, 2014

    Someone please answer me this..
    Spotify's Market Cap is around the 4.5$ billion mark

    Apple are buying beats for 3.2$b

    Why exactly are they pursuing Beats Music - if Spotify has already established itself?

    Just for the hardware?! I understand Irvine and Dre are two they are keen to add onto the board. Otherwise it appears as they are just willing to gobble down the headphone section into their product line..?
  13. yinz macrumors 6502a

    Apr 12, 2012
    The idea of Beats helping the wearable tech from Apple sounds interesting.
  14. trife macrumors 6502


    Apr 16, 2012
    I'm happy for all you Apple doomsday prophets--you can relax now.

    All you undercover (and also overt) bigots can still kick rocks though.

    And to all the aforementioned groups, see you at the iPhone 6 launch.
  15. VulchR macrumors 68020


    Jun 8, 2009
    This still seems a little weird to me. I cannot imagine how anybody could think that Apple s going to get a good ROI on this, but no doubt Apple has information that I do not. Still I would have thought Lytros would have been a better acquisition - they're doing something different that is not so easy to copy. The worst thing about Apple's Beats acquisition is that Samsung and Microsoft will now acquire competing subscription services, ever expanding the range of mediocrity.
  16. Michael Goff macrumors G3

    Michael Goff

    Jul 5, 2012
    Don't pretend SJ never bought his "innovation". :|
  17. whsbuss macrumors 68040


    May 4, 2010
    SE Penna.
    My guess is "Beats by Apple" will be the branding.
  18. satcomer macrumors 603


    Feb 19, 2008
    The Finger Lakes Region
    All I consider is the Dr. Dre headphone are headphones with a equalizer built in the increase base and take out midrange. The only thing the Beats Headphones are good for is base heavy rap music. Something like Ska or string instrumentss music and it sounds terrible.

    I have to think Apple is really after the rap music crowd and the record labels Dre has has ties with to capture rap music lovers, along with some streaming tech and streaming patents.
  19. WinstonRumfoord macrumors 6502

    Mar 27, 2014

    Firefox/John Q Public effectively ousted it's CEO for donating $500 to a cause against gay marriage.

    I wonder what Apple, a historically progressive company will do about Dr. Dre making millions glorifying homophobia and misogyny?

    "Long as my mother****ing pockets was fat
    I didn't give a **** where the bitch was at
    But she was hangin' with a white bitch doin' the **** she do
    Suckin' on his dick just to get a buck or two"

    Just food for thought...
  20. avanpelt macrumors 68020

    Jun 2, 2010
    Two things are likely, I think: Spotify wouldn't even talk to Apple or Spotify wanted more money than Apple was willing to pay them.
  21. Chumburro2U macrumors 6502


    Sep 14, 2009
    I Love L.A.
    Wireless Streaming Headphones

    We don't know of any new products that Beats has coming down the pipe line. Maybe Apple has this info among other info to make this purchase of Beats.
  22. Jambalaya macrumors 6502a

    Jun 21, 2013
    Apple have been "sufficiently impressed" by Beats streaming service launched only a few months ago to pay $3bn for the company - really ? Well the stock market doesn't know what to make of the acquisition, the share are unmoved.
  23. kyjaotkb macrumors 6502a

    Nov 20, 2009
    London, UK
    converting users into paid? Beats doesn't have an ad-supported conversion funnel. Spotify, Deezer, Bloom do. Beats, Rdio, Napster don't. Beats has not proven that it can convert any users to their paid tier... For the moment, the vast majority of their users are AT&T bundled customers, not standalone paid subscribers.
  24. Frankied22 macrumors 68000


    Nov 24, 2010
    It's going to be so hilarious if this whole rumor turns out to be just a rumor and Apple doesn't even buy Beats.
  25. Zerilos macrumors 6502a

    Dec 18, 2012
    Valuation does not equal sales price. Whatsapp was valued at 1.5 billion and was purchased for 19 billion.

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