Apple buys Beats Audio for $3 billion

Apple buys Beats Audio for $3 billion
It's now official. Apple has purchased Beats Audio for $3 billion. $400 million of that amount will vest over time. It is the largest purchase ever made by Apple, and represents a small amount of the company's $160 billion cash hoard. Apple CEO Tim Cook said that Beats Audio's co-founders, Jimmy Iovine and Dr. Dre, will be spending more time in Silicon Valley, working for Apple. Cook also said that the Beats brand will remain intact.

The purchase is an admission by Apple that its pay-per-tune payment plan for iTunes is not working. Apple wants to have a service that charges users monthly for access to content, and Beats Music fits the bill. Dr. Dre dialed down the celebration after an initial self-congratulatory video selfie made Apple brass a bit worried about the deal. Today, Dre said, "Financially I'm in a place I never dreamed of. Now I'm just ready to get started with the work."

Many might consider the price high considering Beats Music had just 111,000 paying subscribers in March. But the headphones division raked in over $1 billion in revenue, and that might be a cash cow for Apple until the streaming music side of the company starts performing.


source: USAToday

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82 Comments

1. ArtSim98

Posts: 3535; Member since: Dec 21, 2012

I didn't like Beats in the first place, so not a big deal to me.

5. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

I breathed a sigh of relief as Apple didn't buy Spotify.

16. Droidrapist

Posts: 186; Member since: May 28, 2014

They have money to buy them too... LOL. Don't hold your breath. Att bought Direct TV anything is possible in 'Merica!

21. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

You are right -- Apple has the money and that is what concerns me. They could still buy Spotify, Sonos, and Sennheiser and have a powerful combination of streaming, whole house audio, and truly high quality headphones (note that Sennheiser does more than just make headphones). All of these products would suddenly stop working well, or at all, with non-Apple products. And Apple's insane greed would eventually suck the life out of a high quality company like Sennheiser.

47. Arte-8800

Posts: 4562; Member since: Mar 13, 2014

And Beyer Dynamic headphones

43. Marienx

Posts: 118; Member since: Aug 27, 2013

Dude, that would suck... Google should buy it before its too late.

53. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

Actually, the DOJ should dust off the Sherman Antitrust Act and chop Google up into little pieces. And not let them reassemble like ATT/VZW.

56. joey_sfb

Posts: 6794; Member since: Mar 29, 2012

The same can be say about all three monopoly. Apple, Google and Microsoft. Let the small guys have a chance.

41. Phonecall01 unregistered

Not a big deal for you; So you wouldn't bother read and comment. Oh Wait a minute...!

63. akki20892

Posts: 3902; Member since: Feb 04, 2013

U r here since 2009, and not too many comments. I mean how? Lol why u won't feel to comment. Beacause I can't just read comments and not comment too much.

73. crazzyd77

Posts: 36; Member since: May 07, 2014

Same here.

75. crazzyd77

Posts: 36; Member since: May 07, 2014

Same here.

2. Neo_Huang

Posts: 1067; Member since: Dec 06, 2013

Two overrated and overpriced companies have joined together in a mission to swindle more clueless consumers.

4. Arte-8800

Posts: 4562; Member since: Mar 13, 2014

Good to know Apple is down by 3billion from offshore reserves

9. Sauce unregistered

At least they can toss around billions of dollars without it even tickling them lol You'll know Apple is in a bad position when they start saying "iPhones shipped" instead of sold :)

15. PBXtech

Posts: 1032; Member since: Oct 21, 2013

The whole "shipped" vs "sold" bit is nonsense. OEMs don't ship phones to people that don't purchase them. It's just doubletalk from a certain side to make it out like they didn't sell those phones.

25. Sauce unregistered

Your comment is nonsense, and so is that argument. A-Rod swings at 100 perfect pitches. Hits 3 home runs. BREAKING NEWS: A-ROD HITS 100 HOME RUNS IN ONE GAME! Oh wait…. was the pitcher supposed to deliver or "ship" 100 home runs to the opposing team that game just because the batter wanted the home runs? Hmmmmm…….

40. PBXtech

Posts: 1032; Member since: Oct 21, 2013

And of course your baseball comment makes perfect sense? okay Why not use some obscure automobile analogy while you're at it.

82. jroc74

Posts: 6023; Member since: Dec 30, 2010

I disagree on that. I can ship 100 million phones to retailers, but if they dont get sold.....what was the point? Is the retailer gonna keep buying phones from you that only the retailer buys? Using the shipped number will always look better. Ask Nintendo about that with the Wii U...or even MS and Xbox One.....

23. darkkjedii

Posts: 30977; Member since: Feb 05, 2011

Excellent post bro

26. Sauce unregistered

They make me laugh Jedii. As much as I love a variety of OEMs, this whole "shipped" thing is silly. IF Apple used the "ship" gig and gave that to the public each quarter, Apple would decimate the playing ground 100 fold than it already does lol. Read post 15 & 25.

34. darkkjedii

Posts: 30977; Member since: Feb 05, 2011

Post 25 may be the best post ever lol. Dude you're killing these jealous couch potato fandroids. Go easy on em Sauce, most are like 13 years old, and 250 lbs dude lol.

39. AfterShock

Posts: 4146; Member since: Nov 02, 2012

You just scream of stranger danger to them now.

54. Arte-8800

Posts: 4562; Member since: Mar 13, 2014

Says the guy who stalks on underaged girls and has a middled age old wife Lmfao jealous… more like hate and dislike that the patent troll company will tumble and decend in coming years Jealous my foot of Apple Says the guy who wants to camp with his wife for couple of nights to buy the ip6, with bunch of young kids

59. darkkjedii

Posts: 30977; Member since: Feb 05, 2011

Awwww he's mad and butthurt lol. It'll be ok Artepooh.

66. Arte-8800

Posts: 4562; Member since: Mar 13, 2014

Hahaha,,,,, I can't stop laughing cause of you, a big huge tall guy like you camping over night to buy an ip6, wth your wife, wth lmao

68. darkkjedii

Posts: 30977; Member since: Feb 05, 2011

Awwww see post 59 LMAOOOOO

38. tedkord

Posts: 17320; Member since: Jun 17, 2009

Apple does use shipped. They count every phone they ship to Verizon, AT&T, Best Buy, etc...as sold. Because they are sold. Just as Samsung's are sold when Verizon, AT&T, Best Buy, etc... buy them.

44. willard12 unregistered

Since T mobile, Sprint, Rogers, best buy don't report to Apple what they sell, I'm afraid Apple is in the same boat as everyone else. If they do report "sales," it is simply as an estimate from an analyst. http://www.ubergizmo.com/2014/01/apple-expected-to-report-record-iphone-and-ipad-shipments-later-today/

35. AfterShock

Posts: 4146; Member since: Nov 02, 2012

If the carrier is contractually signed to sell them or loose money on inventory that can't be returned, what exactly is the difference that would decimate market?

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