Jimmy Iovine and Dr. Dre May Make First Official Appearance at Apple's WWDC

[CEmajr]

And just like than in an instant Dr. Dre will surpass Sean Combs, Jay-Z and anyone else hip-hop related to become the first billionaire in that industry.

 

[dabotsonline]

I've used Spotify, rdio, Google Play and Qobuz for prolonged periods of time.

Interesting. Qobuz is 16/44 for streaming, and you can choose the songs.

 

[Gasu E.]

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.

Actually it is quite realistic that they would triple their worth in eight months. The valuation you cite is not based on any kind of market cap. It is an extrapolation based on the percentage a single investor got in return for a large cash infusion. If that cash was the difference between a viable and non-viable streaming service, it certainly could have tripled the overall worth of the company.

The point is, if you are valuing the company based on a single transaction, that valuation would be very volatile. It is very feasible to see this kind of variation in the valuation of a privately held company in a hot business.

 

[Ericstephen]

I love hip-hop but I dislike Beats for selling headphones with subpar quality for the price. People have a problem with the headphones, not hip-hop. I haven't tried their music subscription service but it sounds like it is actually pretty good.

Regardless, I think this deal will be good for them. It shocked me at first, but I can see the benefits of the deal now. It will probably help Apple TV and iTunes Radio.

The new version of Beats is much improved. Not so bass heavy. Overpriced, yes. But you could argue that exact point with all of Apple's products.

If Beats can command 2/3rds of the headphone market with sub-par products, just wait until they have Apple's billions behind them.

 

[Builddesign]

Hope this is false, I giggle when I see beats. Seriously look and feel like a joke.

 

[Nuvi]

LOL! If Netflix ever wanted to sell which they did to Blockbuster few years back but to Apple it will be very expensive and as for Spotify they will have to work together but I doubt Spotify at the moment would even consider selling because they are doing okay just like Netflix, both companies are doing perfectly and have no problems at the moment to worry about.

Everything is for sale with right amount of money. The point being, integration of Spotify and Netflix would have been killer subscription service (which Apple needs) and not some half ass re-branding job like Beats Music aka MOG. Spotify value is around $10 billion and Netflix $20 billion but in five years they could easily be three times that much. Therefore, they both are good investments at the moment.

 

[usarioclave]

What? Somebody predicting Apple's doom. Wow, I certainly haven't read this in every MR thread ever started. So how long before it's over...One or two months?

It took DEC decades to die, but they didn't do anything substantial for a really long time.

Once you see the "Performa" line resurrected, you know that it's only a matter of time before Apple'll get bought by HP.

 

[wovel]

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.

Where did you get the 1 billion valuation? Forbes reported they had 1 billion in revenue in 2013. Even if you did not expect much growth the valuation would be 3 billionish...

This is by far the most sane major tech acquisition in the past 6 months...

 

[Xeyad]

I don't know about you guys, but these seem to look kinda cool to match the iPhone 5s:

http://uk.beatsbydre.com/earphones/urbeats-se/space-gray/900-00213-03-uk.html

I'm not saying this is a good or a bad move yet, because we all obviously don't have all the info. It's a huge risk for Apple to spend $3.2 billion on a brand, but I believe Apple should be risky and edgy again!

While Beats isn't in any way my favorite brand (I never owned any Beats headphones), I'm very interested to see what Apple does with Beats. Will Apple integrate their products and services to become part of Apple, or will Apple have it's first sub-brand and make the two companies work together? All in all, this is an exciting time for Apple and see what decisions they take next.

 

[mrhick01]

Hey Dr. Dre let me give you some advice. Don't act like one of your homeboys while you work at Apple. If you do you probably won't last long. You see Apple is very serious about why they are doing. Unless you can add something of value you won't be there long. Anyone remember Scott Forstall?

Interesting concern troll in the title.

What is this rhetoric about "homeboys" and having to "add something of value?" Young is a co-partner of Jimmy Iovine in the Beats venture and it has had better-than-solid success.

You reveal yourself. Shame.

 

[Kariya]

Hey Dr. Dre let me give you some advice. Don't act like one of your homeboys while you work at Apple. If you do you probably won't last long. You see Apple is very serious about why they are doing. Unless you can add something of value you won't be there long. Anyone remember Scott Forstall?

Let me also give you some advice. Based on what you've typed, you're the LAST person Dre needs to take advice from. You're clearly ignorant (borderline racist) and nowhere near as successful since you clearly lack business acumen. So why on earth would he listen to anything you have to say.

PS- Enjoy this gif since i know it'll bother you deep down

(stolen from The Verge comments)

 

[paradox00]

So basically all you care about is looks and trend over quality, this is really sad I mean really you think Beats headphone actually sounds good while listening to anything?

Everything you are saying about Beats has been said about Bose. He was pointing out how ironic it was to claim to care about quality and then use Bose of your example. All that said, most unbiased reviews suggest Beats have really good sound quality, but you can find less expensive models that deliver similar quality. If you do wear headphones all the time, I think you should actually care about the looks a little, as they will become part of your appearance. Most people won't wear an ugly watch, thinking in that same way with headphones isn't necessarily wrong.

 

[ActionableMango]

Where did you get the 1 billion valuation? Forbes reported they had 1 billion in revenue in 2013. Even if you did not expect much growth the valuation would be 3 billionish...

I don't know the original source, but several financial websites reported a $1 billion valuation on September 27, 2013.

My entire post was in response to explain why people might be upset. My own thoughts are at the end where I admit that we don't have the information that Apple has access to, and that I trust them for the most part. The books are closed so we cannot possibly know what they are worth, we can only see what investors thought it was worth at certain snapshots in time.

 

[tkermit]

That's excellent

 

[69Mustang]

So basically all you care about is looks and trend over quality, this is really sad I mean really you think Beats headphone actually sounds good while listening to anything?

Where in our back and forth did I even hint that I thought Beats sounded good? If you go back and read everything we've said, you will not find even one insinuation I've made about the quality of the Beats gear. When refusing to back away from a forced narrative, tunnel vision becomes one of the unfortunate side effects. We've gone from the terrible quality of today's rap and hip/hop to the headphones looking bad. The moving target is confusing.

It's all good. This is just forum talk anyway

 

[Coleman2010]

He's not even a real Doctor.

Real doctors don't make as much as he makes.

 

[SlCKB0Y]

Sorry but those headphones look fugly and this is just my opinion but rather save my money and get a decent Bose headphone.

Hahaha. That's pretty funny.... Deriding Beats as overpriced junk when your preference is Bose.

For excellent value, quality consumer headphones look at companies such as Audio Technica and Sennheiser.

Eg. http://www.amazon.com/Audio-Technica-ATH-M50-Professional-Monitor-Headphones/dp/B000ULAP4U

They will destroy Bose or beats at a fraction of the cost.

 

[Rodster]

Hahaha. That's pretty funny.... Deriding Beats as overpriced junk when your preference is Bose.

For excellent value, quality consumer headphones look at companies such as Audio Technica and Sennheiser.

NuForce also makes some really nice low budget IEM's, NuForce 600-X.

 

[Trapezoid]

Hey Dr. Dre let me give you some advice. Don't act like one of your homeboys while you work at Apple. If you do you probably won't last long. You see Apple is very serious about why they are doing. Unless you can add something of value you won't be there long. Anyone remember Scott Forstall?

This is great. Some random person on an internet forum telling a self made millionaire, possibly billionaire how to be a successful businessman. The internet is a hilarious place.

 

[Ericstephen]

Let me also give you some advice. Based on what you've typed, you're the LAST person Dre needs to take advice from. You're clearly ignorant (borderline racist) and nowhere near as successful since you clearly lack business acumen. So why on earth would he listen to anything you have to say.

PS- Enjoy this gif since i know it'll bother you deep down

Image

(stolen from The Verge comments)

Lol

 

[TheMTtakeover]

I like old skool hip hop or rap music even underground stuff like Schoolboy Q or Kendrick Lamar are fine I hate anything on FM radio dials or on MTV (whenever they play music videos, yeah I know).

You think Schoolboy and Kendrick are underground? You must not listen to much rap.

 

[JohnPhamlore]

How can the deal possibly close by June? And if the deal isn't closed, can Jimmy Iovine and Dr. Dre represent Apple?

 

[dmax35]

First African American Keynote speaker? Yay! (I'm black btw)

So what, what does race have to do with it.....

 

[Aragornii]

Next up: Apple to buy BOSE and get into the home audio business.

 

[gotluck]

The new version of Beats is much improved. Not so bass heavy. Overpriced, yes. But you could argue that exact point with all of Apple's products.

If Beats can command 2/3rds of the headphone market with sub-par products, just wait until they have Apple's billions behind them.

I agree with this. I'm not trying to say that apple = beats but the style of the companies are really not so different, at least in terms of pricing strategy. They both have particularly high profit margins.