A fresh report suggests that Apple is in final talks in the process of acquiring Beats Electronics, maker of speakers, headphones and other music-related products and services, for a whopping $3.2 billion. The story is currently developing, but if true, it would represent Apple’s largest ever acquisition.
Compared with rivals, Apple is a little more shrewd when it comes shopping. The likes of Google and Microsoft, as well as Facebook, have all gone above the $10 billion mark when buying out the products and services of other companies, but Beats Electronics, which specializes in high-end audio equipment and also has its own streaming media service, could tie nicely in with the well-established iTunes Music Store.
Not so long ago, HTC purchased a large chunk of the company’s shares, but since the deal wasn’t as fruitful as it was initially hoped, the shares were bought back and the partnership ended.
For a short while, all of HTC’s high-end mobile devices had the famed Beats logo etched onto the rear panel, with the Beats audio-enhancing software also baked in at stock level, and it will be interesting to see – if Apple does indeed plan to purchase Beats – precisely how it will be integrated into the Cupertino’s current product line.
Beats was founded by hip-hop moguls / producers Jimmy Iovine and Andre Young, better known as Dr. Dre, and what started out as a small line of headphones now spans a multitude of audio-related products that also includes a token music streamer.
Not only would this, by far, be Apple’s biggest acquisition, but also the company’s initiation into the game of buying out high-profile brands. Certainly, in the era of the late Steve Jobs, this kind of idea just wouldn’t have been entertained. But even though the company’s iconic co-founder is considered a genius of the Digital Age, he wasn’t always right, and as some of the Mac maker’s recent moves have demonstrated, Apple is unafraid to move forward with new ideas and strategies.
The deal is apparently still being ironed out, and with some of the key details yet to have been agreed, there remains a chance that the whole deal could fall through.
On the face of it, though, Beats looks a very attractive prospect for a company like Apple. Its product line is at the higher end of the pricing spectrum, its brand identity is immensely strong, and it has the “cool” factor that Apple, as well as the Cupertino’s other allies such as Nike, also share.
Given that iTunes Radio has so far struggled in spite of the iTunes Music Store’s long-standing history, integration with the pre-existing Beats service would allow Apple to cut a corner in this regard, and with the deal set to be finalized early next week, we eagerly await to see just what this partnership offer Apple.
We’ll have the details as and when they’re revealed, so stay tuned, and in the meantime, do you think acquiring Beats Electronics is a good move for Apple?
(Source: FinancialTimes)
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