While this makes little sense on the surface, I suspect the folks at Apple are far from stupid. There's likely a solid reason behind this move, and instead of doing the easy thing by saying "b-b-but their headphones are crap!", it'd be more productive to explore the underlying motives.<p>I actually think this is a smart move. Beats first and foremost is a <i>fashion</i> company. The majority don't buy Beats for sound quality, but for the style and image. I see people wearing Beats in all sorts of colors every day on the train. NBA players are seen sporting them at practice or in the locker room. It has become <i>the</i> fashion icon for audio-wear. In the context of Apple's recent fashion-binge with hires from Burberry and YSL, this move may provide further evidence of Apple creating/entering the wearable-tech fashion market.<p>This could also be a response to Apple losing ground in music streaming. Rdio, Spotify have become the default source of music for so many, I wouldn't be surprised if Apple has seen a hit to their music sales. They also botched social music up with Ping, which is an area the aforementioned services are doing pretty well in. Beats may have the connections, the brand and marketing capital, to help make Apple a formidable competitor in this area. But I read here yesterday that the Beats streaming service only has 200,000 low-quality subscribers (ie they joined because their phones came preloaded with the service), so I'm less inclined to believe Apple dropped 3.2 billion on them for this alone.<p>Maybe it's a combination of both, or for a different reason altogether. It's intriguing, nonetheless.
Really weird to see the intersection of hip hop and tech on HN so much this week. I love it.<p>I understand why Beats are popular. They sound great with bass driven music. Its like when people put Bazooka sub woofers in their cars in the 90s. Yeah audiophiles and older people hated them but they sounded great with bass driven hip hop.<p>I still haven't figured out Apples play here. I'm starting to think its a best of both worlds with the earphone tech and the subscription services. I think they wanted them both equally hence the huge number.
After two years and spending 300 million for a 51 percent stake, HTC sold their (now) 25% stake for just 265 miljoen. And a year later Apple buys it all for 3.2 billion. Wow... (edit: spelling)
Beats headphones are crap, sure. And their streaming service isn't as mature as Spotify. But <i>three billion dollars</i> isn't about headphones or online music streaming or Dr Dre's drunken celebration. It's about growth.<p>Apple has a chokehold on the iPod market. They've rocked the market with the iPod, iPhone, iPad and those products will be cash cows for a long time. But where is their next growth going to come from? A watch? I doubt it.<p>All the granola 16-year-old white girls already have their iPhone. There's <i>no</i> room for crazy growth among middle class white people. Apple needs to use it's expertise to pursue new markets, which is exactly what they're doing.<p>Tim Cook isn't afraid, he's strategic. Beats by Dre is a high-end consumer lifestyle brand that GREATLY appeals to black, hispanic, urban-context, young men and women. They sell expensive products. They care about design. They represent a way of living. They're Apple in another market.<p>Beats is about to be Apple's international foray into a completely new growth segment. And it's genius.
All FB and Instagram content seems to now be deleted. Probably learned from 50cent's Twitter stock-ramping faux-pas a few years ago [1]<p>Probably makes it more likely to be happening.<p>If true, this makes sense framed as an acquihire.<p>$3.2bn to bring in Dre, a music industry genius and Jimmy Iovine, a highly influential label boss. iTunes is at risk of aging - kids' parents use it. It may be that Apple recognises the need for a brand for a younger, cooler audience who don't want to buy an MP3 file. Apple has the money but pulling labels (and artists) over to a viable subscription business model is going to take clout, influence and reputation.<p>I expect Dre will shortly be rapping about his unforgettable journey.<p>[1] <a href="http://www.theguardian.com/business/2011/jan/11/50-cent-ramps-stock-on-twitter" rel="nofollow">http://www.theguardian.com/business/2011/jan/11/50-cent-ramp...</a>
This is big. Although to be honest I'm still trying to understand how a company that sells quality stuff is buying the headphones that most audiophiles think is meh.<p>Is all this really just for the name?
This is boggling my mind, it surely can't be about quality. I bet Apple could have bought AKG, Audio Technica or Beyerdynamic for less than 3.2 Billions.
I can't believe no one has yet mentioned that Samsung just last week announced that they were entering the "Premium Mobile Audio Products" market. This likely has nothing to do with Beats' crappy streaming music software, and more to do with holding market share in Apple's main niche: fashionable hardware.
When I see someone wearing Beats I think "there's someone who overpaid" - those are the people Apple want to continue attracting, I guess that's behind this? But the price, seems steep.
The video in question skipped ahead to the important piece <a href="https://www.youtube.com/watch?v=guMFKBXp544#t=46" rel="nofollow">https://www.youtube.com/watch?v=guMFKBXp544#t=46</a>
Not only is Dre the first billionaire in hip-hop, but also the first rapper to (unofficially) announce a multi-billion dollar acquisition with such swag.