Most people are only familiar with Beats as a headphone brand. And Beats headphones are often regarded as overly priced junk with no value to the consumer other than being attached to its marketing. Many Apple fans do not want to be associated with that.
Beats was valued at about $1 billion in late 2013. It is hard to see how they tripled their worth in the last 8 months or so. I bet stockholders are concerned that Apple is possibly overpaying by an enormous amount.
The Beats streaming service is often touted as the main reason for the acquisition. But it's not like Apple is buying a seasoned, successful company. Beats subscription service is relatively new and has only 200,000 subscribers. One wonders how much Apple paid per subscriber and how much it can expect to get out of that. The idea, of course, will be to grow the service. But that's a multi-billion dollar gamble.
One big problem Apple has is that the music industry doesn't like how much power Apple managed to get over them by becoming the defacto source for buying music and music devices. The industry has been very reluctant to grant Apple rights to stream music for fear of the same thing happening to streaming. Some have theorized that the "real" reason Apple is acquiring Beats is to get Jimmy Iovine's industry connections and/or all of the music streaming rights. But this makes no sense for two main reasons: 1) Beats and Jimmy will just be seen as a front for Apple. 2) Contracts for rights typically end upon acquisition, or if they don't in this case, they'll typically expire yearly anyway.
This is pretty much what I'm thinking, based on what little I know. I don't think my concerns are completely unreasonable. Of course the executives at Apple are much more business savvy than I am, and they have access to information that we don't have. I have also liked their acquisitions in the past, so I trust them somewhat. Nevertheless I remain very skeptical about this one, especially the price paid for it.
