Apple CEO, Tim Cook confirmed its acquisition of Beats Electronics in a $3 billion deal. He said: “Music is such an important part of all of our lives and holds a special place within our hearts at Apple. That’s why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world”.
Apple’s SVP of internet software and services, Eddy Cue, said: “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.”
The deal will see Beats’ co-founders, Jimmy Lovine and Dr Dre joining apple, with $2.6billion of the purchase price to be paid immediately and approximately $400million over time.
Notably HTC, until last year, held a significant share in Beats, with Beats branding featuring in its high-end smartphone portfolio. And while initial reactions have been mixed, with Beats’ not a market leader and the majority of its strength largely down to branding and marketing rather than technical prowess the music service will complement Apple’s own proposition and provide an additional hardware revenue stream.