Thursday, May 29, 2014

Apple to Purchase Beats Electronics and Beats Music for $3 Billion

Apple has confirmed its agreement to acquire the subscription streaming music service Beats Music, and Beats Electronics, which makes the popular Beats headphones, speakers and audio software. As part of the transaction, Beats co-founders Jimmy Iovine and Dr. Dre will become Apple executives. The purchase price is $3 billion for both companies, about $2.6 billion in cash and $400 million in stock.

“I’ve always known in my heart that Beats belonged with Apple,” said Jimmy Iovine. “The idea when we started the company was inspired by Apple’s unmatched ability to marry culture and technology. Apple’s deep commitment to music fans, artists, songwriters and the music industry is something special.”

Iovine, an executive in the music industry for decades, has been "an instrumental partner for Apple and iTunes for more than a decade." He has produced or collaborated with some of the most successful artists in the history of the iTunes Store, helping make it the world’s number one music retailer. Iovine and Dr. Dre are sound pioneers, artists and entrepreneurs.

“The addition of Beats will make our music lineup even better, from free streaming with iTunes Radio to a world-class subscription service in Beats, and of course buying music from the iTunes Store as customers have loved to do for years," 
said Eddy Cue, Apple’s senior vice president of Internet Software and Services.

In just five years since it's launch, Beats has become the market leader in the premium headphone market. As part of what has become a pop culture phenomenon, artists such as Lady Gaga, Lil Wayne and Nicki Minaj have designed customized Beats headphones and speakers. Fashion designers and street artists such as Alexander Wang, Futura and Snarkitecture have collaborated on special limited products, while renowned athletes including LeBron James, Serena Williams and Neymar use Beats as a critical part of their training and game day process.

With the acquisition, Apple says the Beats product lineup will be offered in many more countries through the Apple Online Store, Apple’s retail stores and select Apple Authorized Resellers.


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