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

[MrXiro]

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..?

3.2 billion nets them the biggest non-audiophile consumer headphone brand in the last decade. A former record exec that has the ability to get more deals made than they currently have on staff or could hire away from anywhere else (he's also a bit of a shark) and the new highly successful competitor in Beats steaming service line that has made huge waves in it's short few months of existence (has it been 6 months or more? I forget but it felt like yesterday when they launched)

 

[RodThePlod]

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.

I'd LOL so hard!

Especially if Dr. Dre knew damn well Apple weren't in negotiations with Beats. And so him and his mates/Tyreese posted that video just to build up some hype - I mean, I'm sure his record sales have seen a blip this week .

That would be some great marketing by the Dre right there!

RTP.

 

[MH01]

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!

Is that because Apple headphones are known for their sounds quality? And therefore would improve the Beats headphones?

 

[theheadguy]

Hopefully they have some good products in the pipeline (like a television - yeah right!!!) but the innovation is definitely slowing. Cook is a weak CEO who had a shot at Beats before it was developed. He failed to see the vision -- and now they love it once someone else took the vision and made it a reality. The answer? Pull a Google and buy it. How innovative.

 

[ra4oasis]

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..?

I think Apple wants Iovine and Dre for sure, since that gives them huge influence in the music industry. AND they want to compete with Spotify, so combine Apple's money for marketing with Beat's name brand and cross platform appeal, you might have a winning combination. Having sales in the billions in headphones/accessories just sweetens the deal.

 

[crsh1976]

Is that because Apple headphones are known for their sounds quality? And therefore would improve the Beats headphones?

Are you actually saying that Apple earbuds deliver decent audio quality?

 

[WinstonRumfoord]

You do realize those lyrics were about Eazy-E (a man), right?

And how are those lyrics glorifying homophobia?

Oh, and that song came out in 1992. Not saying that excuses the misogyny, but I'm almost positive that some other Apple-affiliated musician, artist, etc. has said sketchy things within the last 2 decades. Stop acting like everyone else associated with Apple has squeaky clean pasts, or that they've never said stuff that in retrospect is wrong.

Those particular lyrics may not be homophobic, but have you ever heard "**** with Dre"?

I personally don't give a damn about his lyrics, I like him as an artist and a business man and support him even though his Beat's products are a little whack IMO.

Assuming this deal goes through as rumored, Dr Dre wouldn't be "some apple affiliated musician", he would be a taking on a senior management role, much like Brendan Eike's senior management role. The main difference being Brendan Eike never assaulted a woman and bragged about it:

"People talk all this ****, but you know, somebody **** with me, I'm gonna **** with them. I just did it, you know. Ain't nothing you can do now by talking about it. Besides, it ain't no big thing-- I just threw her through a door." - Dr. Dre

I'm just pointing out the deafening hypocrisy, is all

 

[Drunken Master]

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...

It's all about the duckets, son.

 

[QCassidy352]

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.

We can only hope. But the evidence is all going the other way.

 

[MrXiro]

That's why it is called "MacRumors"...

But why buying this overprized and underperforming headphones? if Apple wants good headphones there are better ones out there. Way better ones. So, its the streaming thing? Why not buying Pandora or Spotify then, the latter would make so much sense. Link with a button to buy directly from iTunes if you like a song, maybe with a small discount if a Spotify subscriber. Huge user base to win over to iTunes.

Or -why not changing iTunes into a streaming service as well, they have got all the music already, I guess need to renegotiate rights but which company would say to Apple "no, you didn't succeed in music business before so why should we..."

Maybe a rumor after all.

Beats is more about the fashion statement than the sound quality. Beats owners don't really care about SQ like an audiophile. It's about status symbol. Certainly there are better sounding headphones for MUCH cheaper out there, but they don't have that "Air Jordan" shoe like aura about them. Apple is about fashion and tech. My hope is that they'll raise the Beats Sound Quality bar to a more "Apple"-like level.

 

[Macmoney]

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

It would be tastier to their palette if Bono was involve rather than Dr.DRE...that's for sure. The backlash would not be quite as intense,if it was someone 'suitable' to their liking ...no doubt

 

[jonnyb098]

Are you actually saying that Apple earbuds deliver decent audio quality?

Actually the new earpods are very very capable for a $29 price. Most cheaper earbuds in that price range have muddy bass or have a very "in your head" effect. The open nature of the earpods give you very decent bass with an open design that created a much wider soundstage effect that silicon buds just cant replicate. Not for 29 bucks.

 

[fmaxwell]

The idea of Beats helping the wearable tech from Apple sounds interesting.

How would it help Apple's to acquire a company that produces headphones that are reviled because of their boomy, sloppy, loose bass, muffled treble, and high distortion?

Have you ever compared the Monster Beats headphones to respected, high-quality brands like Sennheiser, Beyerdynamic, or AKG? Just look at the frequency response graph. It will make you understand why Andre Young did not put his real name on them.

 

[ghost187]

How is this a bad purchase, I'm sick of all the negativity surrounding this! If they sell over 10m $300~ headphones they get their money back. Plus there is beats radio, and they also got into car audio systems which could hint at better car play integration via beats. If a thermostats company is worth 3B and a free messaging app is worth 19B than beats are a bargain at 3.2B.

 

[HobeSoundDarryl]

I just hope that a focus on streaming services will not mean no high capacity (128 GB or larger) iPhone/iPod touch. I prefer to have my collection (or at least a significant portion of it) with my all the time - 64 GB just does not cut it.

Having said that, the streaming app from Beats actually looks quite nice and seems to have useful functions - too bad it is not available where I live.

Don't you get it? That's the plan. Think about it..

Who gives Apple most of it's profitable revenue? Not us consumers. It's the subsidy-paying phone service companies like AT&T, Verizon, etc.

Biggest customers usually have big requests. What would be the main request by AT&T, Verizon, etc? Help us make even more money with your iPhone

How could Apple do that? They could cut the cost of the subsidy but that's not a good answer for Apple. Or they could find a way to make iDevices burn more data. More data burn sends users into higher tiers. Higher tiers result in more average annual revenue per subscriber for AT&T, Verizon, etc

What would that look like? Apple would focus their innovation on concepts that burn data. For iDevices that would be signature apps that beg for continuous data connections and other ideas related to storing data outside of the iDevices and streaming it. What have we seen in the last few years? iCloud, Siri, Maps, iTunes Match, iMessage, FaceTime, iRadio, etc. What do all of those have in common?

I think Apple would rather sell bigger capacity hardware at higher prices (so 128GB, 256GB and so on). However, I think Apple's biggest customers want Apple to encourage more and more data burn (so they probably want smaller on-board storage). What are the next natural steps for data burn? streaming music and then streaming video and then 4K video uploads and downloads. What are the big rumors flying around? Beats acquisition to yield streaming music, 1000 variations of some kind of cable-killing TV subscription service and camera upgrades that might yield 4K.

There's even a small army of (apparent) consumers here that are always posting about "the future" being "stream everything" and "from the cloud" who always conveniently ignore the stream-more-dollars-from-the-wallet if their view of the future played out.

 

[Gasu E.]

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

Spotify is a privately-held corporation. It does not have a market cap.

 

[jpine]

Subscriptions.

If that is true, then can we expect iTunes Radio to go away?

 

[GeneralChang]

Is that because Apple headphones are known for their sounds quality? And therefore would improve the Beats headphones?

I think the OP was saying that Apple could make them look better. Of course, they don’t look bad now, but that makes a little more sense than suggesting Apple’s headphones are for audiophiles.

 

[Gasu E.]

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

This is true. And "valuation" and "market cap" are two different things. Typically, a privately-held high growth tech corp has an estimated "valuation" based on what the most recent round of private investors paid-- for example, if some VC pays $300M for 10%, business journalists state "the company has a valuation of $3B." But that is going to be much lower than what the company will eventually be worth when it goes public, or in a takeover.

 

[nfl46]

They should definitely keep the "Beats" name. Its widely popular.

 

[nebo1ss]

ATT gives away Beats music streaming for free. I was under the impression this is where the majority of their customer are.

 

[jpine]

Actually the new earpods are very very capable for a $29 price. Most cheaper earbuds in that price range have muddy bass or have a very "in your head" effect. The open nature of the earpods give you very decent bass with an open design that created a much wider soundstage effect that silicon buds just cant replicate. Not for 29 bucks.

Except, at least for my ear structure, I can't use the new buds without a great deal of discomfort. The old earbuds fit better but sound like crap. I don't use either.

 

[DavidG328]

I use Spotify simply because there is no iTunes Radio in the UK. You can't compete when you have nothing to counter with. I would love to use iTunes Radio, but it isn't available here yet!

I use Spotify because iTunes is some of the worst software ever

 

[CosmoFox]

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.

Ska?? Is this 1995??

This is what I expected from Apple. No reason to slap thei logo on the headphones. They want their streaming tech, and the profits if their headphone business.

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How would it help Apple's to acquire a company that produces headphones that are reviled because of their boomy, sloppy, loose bass, muffled treble, and high distortion?

Have you ever compared the Monster Beats headphones to respected, high-quality brands like Sennheiser, Beyerdynamic, or AKG? Just look at the frequency response graph. It will make you understand why Andre Young did not put his real name on them.

Image​

99% of people are not audiophiles, and even you probably can't tell much difference in the test you posted, except for the obvious bass emphasis in the beats. They're just consumer headphones, if you need a scientific chart to prove why something is better you already lost. I would probably never buy beats, just pointing out what you're missing.

 

[cleirac]

iWatch with streaming Beats Music and with soon to be improved sound quality of wireless Beats Headphones make sense and sounds cool to me.

Beats Headphones might be cool and crappy now, but Apple's aim is to revolutionize it plus reinvent it's sound technology (for audiophiles market). That is how Apple's coolness and magic will come to play later for the Beats brand.

This would also mean, Apple's unofficial and or obvious confirmation of future new set of devices coming this year and next year ... like iWatch, iTV and iGame / the reinvented iPod / iPhone phablet where Beats popularity and technology will be utilized seamlessly.

I have been trying the Beats music, good for 3 months free. And I am surprised that I am enjoying it's unique humanize aspects.