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  • Apple to Buy Beats for Lower Priced Deal


    There seems to be never ending reports regarding the news on Apple buying Beats Electronics. Another recent report claims that the terms of the acquisition has now dropped to $3 billion and will be publicly announced this week. The New York Post has reported that the original $3.2 billion offer leaked when Apple was still quantifying the worth of Beats. But in between, before the deal has been finalized and made official, the current price has already been lowered since the initial report. According to a source:

    Apple hadn't even begun its due diligence process when news of the number came out.
    The publication states that the company is placing a high value on Beats’ high-margin audio hardware business. Others have wondered if Apple’s interest in Beats Music was its iTunes Radio streaming service, but sources deny it and say it’s not the case.

    Apple doesn't have a streaming music business so it would be a nice instant get, but the hardware is the profitable business.
    The New York Post has estimated that Beats Cofounders Dr. Dre and Jimmy Iovine will be taking home hundreds of millions of dollars, and Universal Music Group will get more than $400 million on the deal. Lastly, the publication’s sources confirmed the earlier rumor as well that Beats cofounders Dr. Dre and Jimmy Iovine will be at Apple’s WWDC on June 2nd.

    Source: The New York Post
    This article was originally published in forum thread: Apple to Buy Beats for Lower Priced Deal started by Akshay Masand View original post
    Comments 4 Comments
    1. Donnutt's Avatar
      Donnutt -
      Ugh. I really wish apple wasn't buying beats. They're over-priced crap when it comes to headphones. Bass-heavy, muddy, and not at all accurate. Even the most expensive pair of beats are easily beaten by a relatively inexpensive pair of Grado SR120s.
    1. tridley68's Avatar
      tridley68 -
      Quote Originally Posted by Donnutt View Post
      Ugh. I really wish apple wasn't buying beats. They're over-priced crap when it comes to headphones. Bass-heavy, muddy, and not at all accurate. Even the most expensive pair of beats are easily beaten by a relatively inexpensive pair of Grado SR120s.
      I totally agree with you but I feel that they will abandon the headphones there are other reasons behind this deal Apple is a smart company.
    1. bigbaba's Avatar
      bigbaba -
      Quote Originally Posted by Donnutt View Post
      Ugh. I really wish apple wasn't buying beats. They're over-priced crap when it comes to headphones. Bass-heavy, muddy, and not at all accurate. Even the most expensive pair of beats are easily beaten by a relatively inexpensive pair of Grado SR120s.
      I don't think the headphones are really why Apple is buying beats. I mean the hardware sales are nice because it will pay the purchase off by itself in a few years; but I think it's the royalty rates that Apple needs from beats. With the likes of Pandora and Spotify already making money off of streaming, I think the cheap rates are gone. Apple needs to buy someone to get the licensing which will allow streaming to be profitable.

      Just look at the newer articles; the iTunes store's profits are going down. People are streaming their music because it's easier. Apple needs to get on board or they will lose their position as top in music sales.
    1. Silverado1987's Avatar
      Silverado1987 -
      Quote Originally Posted by bigbaba View Post
      I don't think the headphones are really why Apple is buying beats. I mean the hardware sales are nice because it will pay the purchase off by itself in a few years; but I think it's the royalty rates that Apple needs from beats. With the likes of Pandora and Spotify already making money off of streaming, I think the cheap rates are gone. Apple needs to buy someone to get the licensing which will allow streaming to be profitable.

      Just look at the newer articles; the iTunes store's profits are going down. People are streaming their music because it's easier. Apple needs to get on board or they will lose their position as top in music sales.
      exactly.