Apple's Acquisition of Beats Met with Skepticism, but Jimmy Iovine May Be Key

[Windlasher]

Could Apple do it on their own? Yes Probably.

Google could have developed a wireless thermostat in about 10 mins.

Sometimes it doesn't make sense to start over. That said.... 13 billion seems a bit excessive.

If it does happen, Im just going to sit back and wait the Samsung to announce a new headphone line.

 

[DTphonehome]

Dr. Dre had history with Steve Jobs.

Do you really think 3.2 Billion is anything for Apple? Apple just spent 100 Billion on AAPL stock buy backs to keep Wall Street happy, to me that was a much larger chunk of cash. Many say that stock buy backs are just gimmicks. Never the less, 3.2 Billion is nothing for Apple!

Stock buyback is comparing apples and oranges. A buyback is Apple acquiring more Apple. Shows they have faith in their company. An acquisition demonstrates faith in another company. That it can boost the bottom line or otherwise bring some value to the table. On it's surface, Beats doesn't do that. At least not 3.2B worth. As a longtime apple investor, I hope there's something behind this that isn't obvious. But companies aren't immune to mistakes. The legendary Jobs isn't at the helm anymore. Only time will tell if this is a blunder. But the very fact that a lot of people are scratching their heads over this does make this different from Apple's moves in the past. No one questioned Anobit. No one questioned Authentec. No one questioned PA Semi.

 

[peterdevries]

Exactly, Beats had well over $1 billion in revenue back in 2013...this is not pie in the sky with almost no revenue like Whatsapp, Nest and other recent tech deals.

Beats grew from nothing to over $1 billion in sales in just five years.

Now let's imagine Beats with improved global distribution using the Apple mothership / retail stores.

Beats also has really good margins on their hardware - Apple can probably even improve those thanks to their operating efficiency and scale.

I think the price is quite cheap (Pandora and Spotify have higher market caps than Beats and while they have more subscribers they don't do hardware).

Finally someone that understands what is going on here. Most people here fail to see past their own opinion about the product and look at the market potential.

 

[NateTheVape420]

choice

I disagree, but surely Apple could re-skin it to something more tasteful and in line with their brand, than what Beats currently has.

It basically boils down to personal preference when it comes to look/sound. (But numbers don't lie) people wouldn't let a company grab 51% of a market if it didn't have the best product out i.e., (apple makes the best phone PERIOD)

(lets call a spade a spade pls)

 

[IJ Reilly]

Dont forget bill gates.

He's not for sale.

 

[Risco]

People are only skeptical because they do not know the reason. Apple know exactly what they are doing, this is not your typical Apple acquisition.

 

[abshole765]

Beats by Dre doesn't grab 51% of the headphone market by making bad products. They are the best headphones design wise and quality wise PERIOD. Everyone on here that has something negative to say about this deal is really mad at the fact that there giving a blk guy a billion dollars and that a blk guy is making the best headphones on the market. Beats by Dre came in and changed the headphone game forever the same way apple did with the Iphone. This is a great acquisition and a tremendous deal for both Apple and Beats and just goes to show why apple will be the number one company to ever exist in the near future. (the world is changing folks get rid of the hate from your heart it will only lead to hate in the world)

Lmao. You're hilarious.

 

[HKPDW]

And for only $3.2 Billion (what a deal). Giving the .gov a run for it's money when it comes to wasting money.

If I were an Apple share holder, I'd be like and then

 

[dominic252]

Beats by Dre doesn't grab 51% of the headphone market by making bad products. They are the best headphones design wise and quality wise PERIOD. Everyone on here that has something negative to say about this deal is really mad at the fact that there giving a blk guy a billion dollars and that a blk guy is making the best headphones on the market. Beats by Dre came in and changed the headphone game forever the same way apple did with the Iphone. This is a great acquisition and a tremendous deal for both Apple and Beats and just goes to show why apple will be the number one company to ever exist in the near future. (the world is changing folks get rid of the hate from your heart it will only lead to hate in the world)

Seriously?? I'm not even going to comment on the race thing, but what makes you think they're the best? Because they sell the most? Simple marketing. They are far from the best headphones you can get.

 

[shiseiryu1]

These talks need to fall apart. With that money, Apple could instead buy a company to strengthen their AppleTV vision/offerings.

 

[topmounter]

The positive takeaway is that Apple is not buying Spotify, despite Spotify being a FAR better deal on a cost per paying sub basis.

I just hope Apple deep sixes the fashion-phones rather than slapping on an Logo and rebranding them the Apple Hi-Fi Rokr.

 

[Karma*Police]

I agree with you. However, I have to think that Apple's officers, board-members, and others didn't make this acquisition on a whim. I doubt they took spending 3 billion dollars lightly.

However, I still don't see the point...yet.

It's clearly out of character for Apple, but when companies get as rich as Apple or Microsoft or Google, and the disciplinarian (ie, Steve Jobs) is no longer there, they start making a lot of dumb decisions. Just look at how much Microsoft and Google have wasted on silly acquisitions that lost them billions. $3B for a company the size of Apple is play money.

As much as I'd like to believe there's serious merit to this acquisition, it could just as well be one of those boneheaded decisions by a management team that's lost sight of how much $3B is really worth and giving into temptation to spend their cash hoard.

 

[Mac32]

My guess is there's a patentable headphone technology Beats is working on in secret that is a game changer.

Well that would be a surprise, since Beats headphones are pretty crappy. There are obviously things we don't know about here, but this seems like huge waste of money. Should we be surprised though, when Apple uses Jimmy Iovine as a special adviser? Little good will come out of that alliance (which was my immediate thought when I heard about Apple and Iovine).

 

[pti6ity]

Could it be that Apple's purchase is hinched upon a successful renegotiation with the record labels on the music streaming? That it would go through only if that part is done. And so since the rumors are close to being a done deal, we can assume that the music licenses to Apple have been successful?

 

[3N16MA]

At least we have more to talk about than iPhone 6 mockups.

 

[Millionaire2K]

I did not read 1 post in this forum. I just felt the need to say:

I don't know why Apple would acquire beats? If Apple came out and sold Apple $300 high end headphones beats would go out of business.

Apple is paying for the name. And it makes no sense to me as Apple is already a major brand.

Anyone can make headphones. There is nothing special about beats. Its all about product image. Apple should have made their own, not buy beats.

I'm not saying they wont make money. I just don't see the need to buy the beats brand when Apple is a stronger brand.

So now we will get "beats" headphones "sold by apple"

 

[iolinux333]

If true, this literally has to be the worst acquisitition i can think of.

I hate Beats with a passion - all style, no substance.

As a longtime (20+Years) Apple user, I don't want this kind of philosophy (further?) taking over Apple - all about fashion and brand. Angela Ahrends, Beats etc.

Just make a damn good product and it sells itself by merit. Stop the fluff.

Kids get off my lawn. I know.

I dumped android after 3 years of them getting worse and worse. Apple seems to be going down an albeit different road to hell, but it's still in the same direction so I'm today seriously looking for the next place to jump. I'll probably try jolla when it has a US LTE radio. Ultimately I think open source software AND hardware will be our only chance to escape the horror, but it is only that - a chance.

 

[zipadidoodah]

From where I'm sat if it baffles analysts and meets with scepticism, then its probably a good thing as they usually 'predict' recycled info and incredulous ideas!

 

[bushman4]

Makes no sense. What can beats do for Apple ...... NOTHING!!!
Price makes no sense and from what I'm reading on papers , media sites etc nobody seems to be in favor of this

 

[cdmoore74]

Because of the brand?? Don't think so... Is apple develope a pair of over ear headphones and put an apple logo will sell like hot cakes.

This. Apple could easily get into the music hardware business with their own brand and bring something new and innovative to battle against Beat and Apple. Could have created some new jobs in the process. To me this is like buying a Samsung made smart watch because you were to lazy to innovate.

 

[PatriotInvasion]

Here's something odd. Everyone seems to want a la carte television channels and no monthly subscription to cable, yet everyone already has a la carte music but wants to be tied into a subscription fee. This is likely due to the cost discrepancy of both services, but still a bit bizarre.

 

[mabhatter]

Preemptive me thinks.

Apple has been busting its chops for years to get a real streaming service going. iTunes Radio is OK, but its got no "soul" behind it. Apple doesn't have people that LOVE iTunes Radio fanatically.. The same way Apple loves making iPhones and iPads.
Beats has done the work to build a better, cross-platform service than Apple is going to get with just "suits" making deals.

Beats can replace iTunes radio with nothing lost, but Beats seems to have a lot more "love" put into making the best service they can... Apple craves that kind of thing

 

[3N16MA]

So when do we see the first unibody aluminum Beats designed by Ive?

 

[iolinux333]

Instead of a real sound equalizer to tailor sound to the sound systems we already have, a move that would cost apple nothing yet endear them to the audio world, I'm supposed to buy a set of crap Monster Cable headphones to make up for $3billion dollars they stupidly spent? Not.

 

[please22]

Yeah I was saying this in the earlier thread. This is all about what Jimmy Lovine can do. His reach is long in the music industry.

And it still doesn't make sense. Is Jimmy going to grow Apple's subscription business by $3 billion with spotify, rdio and others competing in that same space just because of his ties to music? I'm sure Apple could buy 100 music execs with that money.

And Jesus...I keep hearing people speculating about "incredible" headphone patents or technology. We are talking of fsking headphones. Used for listening to music. That's it. That isn't going to be growth business like anything Apple has released in the last 6 years.