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Apple Is Close to Buying Beats Electronics…

Screen shot 2014-05-08 at 4.29.48 PM

We’ve been speculating about when Apple will launch their upcoming streaming service. What if Apple is actually doing so much more? Financial Times reports that Apple is about to make an unprecedented move

According to sources, Apple is closing a deal to acquire Beats Electronics for $3.2 billion.

Negotiations are still taking place and are not yet set in stone, but the deal could possibly be announced by next week. Apple would be acquiring both the headphones / hardware and the Beats Music streaming service.

The heads of Beats are slated to report to Tim Cook, Apple’s CEO.

Unsurprisingly, Apple and Beats both declined to comment.

Nina Ulloa covers breaking news, tech, and more. Follow her on Twitter: @nine_u

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Comments (23)
  1. TuneHunter

    Hefty price to buy leverage in RAT RACE TO DEAD END TUNNEL.


    Reply
  2. Anonymous

    The hardware is OK, but the streaming part is silly.

    Lala, anyone?


    Reply
    1. Anonymous

      Talking hardware – Google purchased a thermostat for $4.2 billion.

      To much of printed cash in the system, Great Depression in front of us!


      Reply
      1. hippydog

        Quote “Google purchased a thermostat for $4.2 billion”

        i’m not saying it was a smart decision, but i totally understand their reasoning behind it..
        do a search on “connected homes” and you will see a glimmer of how they are trying to position themselves..
        Time will tell if that purchase was stupid, or a pure act of genius..


        Reply
    2. Anonymous

      Exactly.

      Apple is and always was a hardware company.

      This is a golden liferaft for Beats streaming, as well as the tech/hardware side.

      They just spent WAY too much buying assets back from HTC, and while the hardware aspect is still strong there are dozens of other players diluting that market segment since they launched.


      Reply
      1. TuneHunter

        I know, that 4.2 was for “bulk purchase” of ex-Apple brains – better deal than Beats or dead-beats acquisition


        Reply
  3. andre

    What exactly is Apple buying if the Beats brand/branding will be subsumed into Apple products? As far as Beats Music is concerned, is the streaming technology too costly to be developed by Apple? This acquisition doesn’t make sense to me.


    Reply
    1. Anonymous

      “This acquisition doesn’t make sense to me”

      It didn’t make sense to Steve Jobs either, according to allthingsd (Iovine tried to sell him the idea, but failed).

      If Apple can’t invent new products without Jobs, it should acquire services people actually want.

      YouTube, for instance. That’s the future.


      Reply
    2. bought

      beats did a deal with come phone company & acquired a huge amount of subscribers/clients. that’s what apple is buying


      Reply
      1. jw

        There was nothing preventing Apple from doing any deals with any telecom. They pretty much started that trend with AT&T iPhone exclusivity.

        The one thing they’re not buying is customers, or some sort of telecom agreement.


        Reply
  4. Anon

    I’d be really interested in seeing the justification for that valuation. Anyways, it now makes sense why Dre was apparently looking at buying Tom and Giselle’s house in Bel Aire.


    Reply
  5. Candid

    The headphones are a successful lifestyle fad, the streaming service is the ghost of MOG with less traction than iTunes Radio. This is either a BS rumor to drive up valuation of Beats for another possible suitor or the death knell of of Apple in the post-Jobs era.


    Reply
  6. Anonymous

    This allows Apple to enter the streaming market without damaging iTunes in the short term, which would have been the case if it had developed it’s own streaming into the iTunes experience. Apple will keep its grip on the music industry still.

    Likely to prove more of a challenge for Spotify/Deezer to permeate the US/UK market


    Reply
    1. Andreas Ae

      Apple is already entering the streaming market albeit in the retro-fashion of iTunes Radio, but it is a streaming service set up to facilitate itunes store purchases based on ‘free’ discovery of new music.
      Seems the Beats headphones is a co-op way to maximize revenue on a product already sold by Apple online. Is the Beats hardware also available in the physical apple stores?


      Reply
  7. Willis

    Steve Jobs is rolling on this one. Is this the start of the decline of Apple?


    Reply
  8. All about the D-R-E

    The best thing about this is that Jay-Z is gonna be pissed when the deal closes and Dr. Dre becomes a billionaire.


    Reply
  9. jw

    This is an interesting buy, & I think it’s a smart move. Apple is a hardware company, & they only make software in order to prop up their hardware sales. Without the hardware component, the Beats purchase wouldn’t happen. Beats headphones share Apple’s top tier values of style and experience, so it’s a good fit. But the sale also wouldn’t have happened without the streaming component. This also allows Apple to plan for the future without cannibalizing their current business. Launching iTunes streaming would push the iPod out of their product line, & it would marginalize the digital download collections that users had spent billions of dollars & more than a decade building. This allows iTunes to maintain their strategy of using iTunes Match to merge ownership and streaming, but doesn’t limit their consumer base to those holdouts (it could be that Match subscriptions aren’t hitting expectations, or the digital download drop off is more severe than expected). Beats allows them to plan for the future on a parallel path that could merge down the line.

    All of the Steve Jobs comments seem ridiculous to me. If Steve Jobs was about anything, it was timing… just because Apple didn’t launch streaming during Steve’s lifetime doesn’t mean that it wouldn’t make sense at some point. Streaming is an inevitability, Apple just needs to get the timing right.


    Reply
  10. Georgina

    this is really a gamble for Apple knowing that Beats is not in a good state nowadays. But let’s not be close minded because we know that Apple company will not release such amount if they know they cannot profit from that investment. but let’s hope for the betterment of this deal.

    Share your ideas with me and check this site for more news update: http://kroid.net/will-apple-make-the-right-decision-in-acquiring-beats/1944


    Reply
  11. Steve Jobs

    If I were still alive, this deal wouldn’t even be a thought. It is a terrible decision to acquire Beats. The headphones are inferior and the valuation is far too high.


    Reply

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