Apple buys Beats for $3 billion

It's a done deal, Apple has announced that it has purchased Beats headphones but it will leave the brand in-tact, for now, as it works to integrate the products into its portfolio of goods.

Co-founded in 2008 by hip-hop artist Dr. Dre and music executive Jimmy Lovine, Beats Audio has become known for its high-end products like its headsets, earphones and speakers. At one point, HTC had a 50.1 percent majority stake in the company but in 2013 it sold off its shares.

As part of the acquisition, Beats co-founders Jimmy Iovine and Dr. Dre will join Apple and will likely be prominent figures in helping Apple expand its music streaming services. Earlier reports suggested that Apple was interested in the subscription music service, potentially more than headphones that made the company famous.

Beats has become a 'known' name in the headphone market and has the iconic branding that likely attracted Apple to purchase the company. Apple says that they believe this deal should close later this year, pending regulatory approval.

Source: Apple

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Well it's a deal to make more money and more money they will make. They'll make it off the suckers that actually buy their products (Beats that is since Apple actually does make some good stuff...sometimes. ;) )

This deal is all about Lovine and his inroads into the music/media business. He is to take the place of Jobs in making deals and arrangements within the business to keep the cash cow that is iTunes boat afloat and on steam. Cook is not the man to do that and does not have the clout to pull this off like Jobs did while Lovine does. The products, services and Dre are a bonus but it's all about Lovine who by himself will be worth the investment.

I enjoy Apple products for the most part, especially Mac OS and the MacBook Pro line of computers, but not so much Beats. Beats has always seemed tacky to me, for kids with more money than brains. They sound decent but not at the price they sell for...

I think this move is still good though in that having the Beats brand will snag more urban (and sub-urban I suppose) youngsters into the Apple fold...As well having Dre on board with his creative input can't hurt, he is one of the best on the planet when it comes to not only predicting trends but starting them. His insight alone is worth the $3b, the Beats brand is just icing on the cake.

Makes sense. Just like Apple products, people only buy Beats to show them off. Few months ago I was entering the gym, and randomly a guy comes up and says "Yo I got the Beats". I didn't even know this guy.

Do i like Apple products?, Some of them but usually yes.
Do i like rap or any products related with rap?. No.

Do i feel alienated with this move?. it depends on Apple.

I'm still interested to know what HTC will do with their audio in the One... License from Apple perhaps?

I'm RICH beotch!. Even Chappelle has to be impressed by this one. Seriously, I don't get it, crap hardware and a couple hundred thousand users all driven purely by marketing. At over $10,000 per user Jobs is turning over in his grave over this nonsense. Did Tim Cook have a "Hangover" weekend that we all missed?

This is NOT for the headphones, its for Dre and Lovell and the clout they have in the industry along with the image they have with people.

i don't think apple will inc beats headphones with there products, for me its there music service they are after. Will be interesting to see what happens.

Interesting choice. I am curious to know what they are going to do with it, its more like Apple to buy smaller companies. Obviously Apple is not about to slap BEATS on their iPod and iPhones. They didn't need to spend $3b for that. So their plans must be elsewhere.

Lol at all the people claiming its a bad move etc. Newsflash. Tim Cook knows more than you about Apple. How someone can see this announcement and claim to know enough to call it a bad move is delusional.

Next year: Buy a pare of high-definition, high quality, modern and slick and great sounding, apple-powered headphones for only $1,999!

Kalint said,
Alright Dre, now you're REALLY rich now. How about that detox album?!

I too still cling to hope, Dre get in the studio and drop another classic please!!!

I love this quote:

Beats has become a 'known' name in the headphone market
. Yeah, the way Budweiser has become a known name in the beer market. Number 1 beer in America, and the worst tasting swill in the universe!

devHead said,
I love this quote: . Yeah, the way Budweiser has become a known name in the beer market. Number 1 beer in America, and the worst tasting swill in the universe!

I remember after I bought a pare of $99 head phones I had my female friend try them on she said "You should have bought Beats head phones, they are the best!"

warwagon said,

I remember after I bought a pare of $99 head phones I had my female friend try them on she said "You should have bought Beats head phones, they are the best!"


Beasts is the Apple in headphone market where things sell by their name; not quality.

i can see it now. in a year or 2 apple will launch a couple models of the rebranded beats headphones (look and sound the same as the current beats models out there). they'll have the apple logo on them now instead of the b and the price will be marked up 30-40% :D

Two things Apple bought Beats for. Beats have a good marketing for headsets that Apple can't reproduce and second they there music subscription.

They had a revenue of $1.5 bn in 2013 according to Wikipedia, and it's reported that their margins are ridiculously high so you're wildly optimistic with your statement

In before all the audiophile wannabe's slating Beats because it's the cool product to hate on, just like Apple.

I'm looking forward to seeing how they integrate this into their line of products.

goodbytes said,
In before all the audiophile wannabe's slating Beats because it's the cool product to hate on, just like Apple.

I'm looking forward to seeing how they integrate this into their line of products.

As per my non audiophile teenaged son they are targeted towards told me, "they suck, the sound is crap", AND he tried to top of the line headset they have, he was not impressed at all

goodbytes said,
In before all the audiophile wannabe's slating Beats because it's the cool product to hate on, just like Apple.

Or because they know more about audio products than you do and can recognize that Beats is trash-quality sold at ripoff prices.

Lord Method Man said,

Or because they know more about audio products than you do and can recognize that Beats is trash-quality sold at ripoff prices.

And yet theyre successful, and not on the internet thinking they know better than successful business men.

Beyond Godlike said,

And yet theyre successful, and not on the internet thinking they know better than successful business men.

Because they sell junk to uneducated consumers, like Bose. I think we've gone over this already, please try to keep up to speed.

goodbytes said,
In before all the audiophile wannabe's slating Beats because it's the cool product to hate on, just like Apple.

I'm looking forward to seeing how they integrate this into their line of products.

Well we didnt have to wait on the Apple fans that mocked Beats, but are now pretending like it is the most awesome brand in history only because Apple bought them posts.

So now all of those people are just stupid "audiophiles".

I bet if they bought Bose you guys would call that the best audio company on Earth too!

Anibal P said,
As per my non audiophile teenaged son they are targeted towards told me, "they suck, the sound is crap", AND he tried to top of the line headset they have, he was not impressed at all

Suck and crap? Well, that's incredibly insightful and descriptive... I guess that also trumps all the 4/5+ ratings and reviews elsewhere.

dead.cell said,

Suck and crap? Well, that's incredibly insightful and descriptive... I guess that also trumps all the 4/5+ ratings and reviews elsewhere.

I'm guessing the people leaving such ignorant reviews are also fans of rap so-called "music."

Lord Method Man said,

Or because they know more about audio products than you do and can recognize that Beats is trash-quality sold at ripoff prices.

Thats a bold assumption to make..

I think your under the impression that i'm saying these are the best headphones ever but i'm not... Yes they are over priced, Yes their brand sucks, No they are not the best... Is the sound quality good enough for every day use and better than standard headphones shipped with devices that cost like £20.. yes, this is why i think it is a good thing for Apple, i've used a pair of Beats Studio on regular basis watching movies and listening to a bit of music and on the surface they are loud, vibrant and crystal clear..not everyone wants to measure technical aspects of everything.. sometimes a product can just do a pretty good job at what it does.

They are far from the best but responses as 'they suck' is just absolute rubbish.

The above is assuming Apple actually start shipping beats technology with their products.. we don't know Apple's plans yet.

Yes. Beats headphones straight out suck. I've used Sony's, Pioneers and other brands and every time I go into a shop to buy new ones I still try the Beats ones just for the fun of it to see if they get any better by the time, they don't. An ordinary €100 Pioneers blow them out of the water. Just because something is "popular" doesn't mean it's good.

If you buy €300 headphones for everyday use you must be seriously mad at your money.

Also beats tech in products, yeah, that worked well for HTC didn't it?

alwaysonacoffebreak said,
Yes. Beats headphones straight out suck. I've used Sony's, Pioneers and other brands and every time I go into a shop to buy new ones I still try the Beats ones just for the fun of it to see if they get any better by the time, they don't. An ordinary €100 Pioneers blow them out of the water. Just because something is "popular" doesn't mean it's good.

If you buy €300 headphones for everyday use you must be seriously mad at your money.

Also beats tech in products, yeah, that worked well for HTC didn't it?

I don't see what price has got to do with anything, it is a product of desire so if people buy them it will be for general every day use.

Lets just agree to disagree, if the quality was that bad they would simply just not sell.

stevan said,

Reviews are opinions. Reviewers are entitled to them.

Nice change of position there. First guy said they suck. You got booty blasted and posted that such an insightful comment doesn't trump all those top notch reviews. So then some actual information about why they suck, for the price charged, is presented and now it's "o-oh...reviews are just opinions".

Yes that's right they are. I prefer actual data to make a purchasing decision especially if it's for something costing hundreds of dollars. I'd prefer if the item was actually any good. Beats headphones? A laughing stock. Sure for the casual person they're probably fine. My wife has a pair that she received as a gift from her father. They work fine for her but she's not exactly an audiophile...nor did she actually buy them herself. But if she was in the market for quality headphones with her own cash I'd advise her to look a bit deeper than what is trendiest and most overpriced.

Edited by Sandor, May 29 2014, 1:55pm :

Lord Method Man said,

I'm guessing the people leaving such ignorant reviews are also fans of rap so-called "music."

Why so upset. I think beats is trash to, but this doesnt affect you.

PhilTheThrill said,

Yes that's right they are. I prefer actual data to make a purchasing decision especially if it's for something costing hundreds of dollars. I'd prefer if the item was actually any good. Beats headphones? A laughing stock. Sure for the casual person they're probably fine. My wife has a pair that she received as a gift from her father. They work fine for her but she's not exactly an audiophile...nor did she actually buy them herself. But if she was in the market for quality headphones with her own cash I'd advise her to look a bit deeper than what is trendiest and most overpriced.

I like how Beats go from being crap to being fine for your casual listener (read: most people), but not good for an audiophile. I don't think anyone disputes this point at all either! Still, you're going off one metric alone, which is not what the average listener goes by. Realistically, how many people are going to walk into a gym wearing a Sony headset? Very few I'm willing to bet.

Appearances matter and so does comfort! I had a guy who enjoyed the Bose headphones a lot better than the Beats, but picked up the Beats for the level of comfort they provided.

To each their own, right? Why we have to sit here feeding our superiority complex on Neowin is beyond me. One cannot sit here and tell me that a multi-billion dollar company with average ratings of 4/5 - 4.6/5 are selling garbage, just because someone doesn't like the product.

Neowin needs to stop being so goddamn dramatic. Opinions are still opinions. :ermm:

(and I don't even own a pair of Beats lol!)

dead.cell said,

I like how Beats go from being crap to being fine for your casual listener (read: most people),

Which is why you'd be better off spending $50 on something just as capable.

dead.cell said,
Opinions are still opinions.

And some opinions are wrong.

PhilTheThrill said,
Which is why you'd be better off spending $50 on something just as capable.

By that logic, why bother with different looking cars that can all get you from point A to point B? Why not just aim for better mileage?

Maybe, just maybe, there is more than one metric at work here, as I stated. The only opinion that's wrong here is the idea that you are somehow in charge of someone else's money and that you know what's best for them, disregarding looks and comfort apparently.

dead.cell said,

By that logic, why bother with different looking cars that can all get you from point A to point B? Why not just aim for better mileage?

Maybe, just maybe, there is more than one metric at work here, as I stated. The only opinion that's wrong here is the idea that you are somehow in charge of someone else's money and that you know what's best for them, disregarding looks and comfort apparently.

"fools and their money..."

Beats? Pretty high on the fool end of the scale

Zagadka said,
No more "iconic" iPhone earbuds? Shucks.

I've noticed there are only two types of headphones that are instantly visible in public... Apple's white earbuds... and Beats' red headphones.

I don't think either are going away... but how funny that they are both under one company now.

Brando212 said,
high-end products? more like highly over rated and over priced. :D

Exactly. Boosting the bass and thus wrecking the rest of the sound quality and then charging $300 for it. It amazes me that a company selling terrible quality products at some of the highest prices in the market could survive.

Yea, with all this talk about this, i had to go try them out. I went to bestbuy, and had some test music on my phone. Venetian Snares, lots of highs, bass, etc... I tried the $170 ones, and they did sound like ass. very muddy sounding highs, mids were meh, the bass was ok. but actually worse than the earbuds that came with my phone.

so, good luck apple!

Astra.Xtreme said,

Exactly. Boosting the bass and thus wrecking the rest of the sound quality and then charging $300 for it. It amazes me that a company selling terrible quality products at some of the highest prices in the market could survive.


A $100 pair of Sony studio headphones will blow Beats away. So clear and natural sounding. Hell even the $20 Jvc or Sony ear buds sound a million times better than any Beats crap.

trojan_market said,
you have a box full of assorted chocolate and you picked the least tasty one. well done apple.

indeed. I checked out various Beats headphones and Nokia's Purity one's (by Monster as well) that cost more than 100$ and they sound like ass. Well I mean there is nothing but a chunk of bass mumbling something resembling what used to be your favorite music. For similar price I got monitor class Roland RH-200 which sounds amazing for it's price but even then there are plenty of other decent headphones for about 150$.

I never ever buy beats products. Its all gimmicky and suffers from poor quality. and I did sound engineering before. a friend of mine was a beats fan once and he bought a pair of headphone. he has been trying to sell those for a while now since he got a pair of accoustic comfort. even some after market headphones sounds better than beats. forgot to say have an HP laptop which has beats logo on it and music is ###### even with the best headphones I have. my old vaio tablet which is notorious for its poor audio quality sounds better on headphones and speaker. (less loud but less distortion)

JHBrown said,
He's really bashing both companies.

Pretty much; a company that successfully sells products for high markups buys a company that successfully sells products for even higher markups.

MightyJordan said,

Pretty much; a company that successfully sells products for high markups buys a company that successfully sells products for even higher markups.

Last I checked a Dell XPS15 cost the same amount as the Macbook Pro and the Macbook Air is now cheaper than most ultrabooks.

Also, my initial question was to ask why the two are similar apart from the price. Apple's products may be slightly higher (or not, as evidenced by recent market prices), their products have always been of high quality. Their customer service is also the best I've ever experienced. When you put that against Beats, the products are pretty average or below average in their market, regardless of the price.

still_rookie said,

Last I checked a Dell XPS15 cost the same amount as the Macbook Pro and the Macbook Air is now cheaper than most ultrabooks.

Definitely not the case here in the UK.

Just checked and the XPS15 starts from £1,249 while the 15" MacBook Pro starts from £1,699. The Dell has a slightly better processor, dedicated graphics, double the RAM, more storage and probably most impressive of all, a higher-resolution display. The only real advantage the MacBook Pro has is flash storage, while the XPS15 uses an HDD with a 32GB SSD cache; performance-wise, the difference would be minimal in everyday use and it's certainly not worth the extra £450 especially considering the rest of the specs you'd lose.

Ultrabook-wise, just looked on PC World and three of the five Ultrabooks they're currently selling are cheaper than the MacBook Air; two if you go with the 11" model, but the one Ultrabook that'd be knocked off coming in at £50 more is 13.3", has a better i7 processor, double the RAM, more storage (albeit a much smaller SSD cache) and a touchscreen. Apple charge £80 to double the RAM on that MacBook Air and an extra £120 to bump up the processor to match the Ultrabook, at that point it's £949, or £150 more for 2" less and no touchscreen.

MightyJordan said,

Definitely not the case here in the UK.

Just checked and the XPS15 starts from £1,249 while the 15" MacBook Pro starts from £1,699. The Dell has a slightly better processor, dedicated graphics, double the RAM, more storage and probably most impressive of all, a higher-resolution display. The only real advantage the MacBook Pro has is flash storage, while the XPS15 uses an HDD with a 32GB SSD cache; performance-wise, the difference would be minimal in everyday use and it's certainly not worth the extra £450 especially considering the rest of the specs you'd lose.

Ultrabook-wise, just looked on PC World and three of the five Ultrabooks they're currently selling are cheaper than the MacBook Air; two if you go with the 11" model, but the one Ultrabook that'd be knocked off coming in at £50 more is 13.3", has a better i7 processor, double the RAM, more storage (albeit a much smaller SSD cache) and a touchscreen. Apple charge £80 to double the RAM on that MacBook Air and an extra £120 to bump up the processor to match the Ultrabook, at that point it's £949, or £150 more for 2" less and no touchscreen.

I may have slightly over estimated the XPS15's cost, but I would still get the Macbook pro over it, and here's why:

Granted that the Dell XPS 15 has a dedicated GPU, but it overheats at the smallest of processes which makes it nearly unusable for the content you would want to use it for. I've looked through enough reviews to note that overheating is one of its major drawbacks. Secondly, yes, you have a better screen but you're never going to use a near 4k resolution screen, simply because there isn't content available at that resolution and also because the icon sizes at that resolution are comical. Macbook pro has higher than 1080p resolution but OSX has been optimized to run at that resolution. The battery life is also better on the Macbook pro (I think by 2 hours, but I might be wrong) and the Macbook pro has also shown to perform better with heavy processes. Apple laptops also tend to have a longer overall life, and I'm talking from experience having owned Dell, Toshiba and Apple laptops in the past.

The stigma that Apple sell over-priced products is a little unfair, especially given how you are slowly starting to see that other companies are edging towards the same price point with their premium products. Hell, the best Windows ultrabook on the market today (ASUS Zenbook UX301LA-DH71T) has a regular retail price of $2000, while I remember that a couple of years ago Microsoft had implied through some advertisements that most of their laptops cost under $1000. In my mind though, sure, Apple haven't come out with the best product on the market in terms of the iPhone and accessories, but when it comes to laptops and the iMac, trust me, they know what they're doing.

Just to clarify I am not taking one side or the other, in fact I'm planning on purchasing a Windows notebook soon to replace my Macbook, but I definitely think that people here harp on about Apple being ###### way too much. There is no way in their right unbiased mind would ever place the Macbook pro below at least 2nd place. I think its still the best and most reliable and the most durable laptop out there today. If it was selling with Windows on it and had a Microsoft logo on it everyone here would be eating it up.

Considering they may be in bed with Nike for the smartwatch they're working on, and given the acquisition of Beats, I'd say that puts their brand in a very good position to market towards what's trending.

Why try to force a trend when you can BE the trend? I'd think they'll do very well with this.

dead.cell said,
Considering they may be in bed with Nike for the smartwatch they're working on, and given the acquisition of Beats, I'd say that puts their brand in a very good position to market towards what's trending.

Why try to force a trend when you can BE the trend? I'd think they'll do very well with this.

They might. They might not.

I do think the same lines though with the Nike smartwatch thing. Why would Nike just stop their fitness watches unless Apple will be catering to their fitness apps?

But beats... I dont know. It beats me... ;) I dont think the brand name is worth anywhere near 3 billion for it. They cant get the same deal beats had. So it leaves headphones (which are head phones) and brand name... That is my thoughts =).

It makes perfect sense to me. Apple and Beats are both known for convincing customers they have something no one else does, and then selling it for a lot of money.

From a pure branding point of view, the Beats brand is worth a lot, it is a name people are will to pay double or more for. If you said that Beats' technology or IP was not worth $3B I would agree 100%.

sphbecker said,
It makes perfect sense to me. Apple and Beats are both known for convincing customers they have something no one else does, and then selling it for a lot of money.

From a pure branding point of view, the Beats brand is worth a lot, it is a name people are will to pay double or more for. If you said that Beats' technology or IP was not worth $3B I would agree 100%.

But their customer base is small. High end head phones are discriminator by nature (I mean, only the wealthy can buy them which I have no problem with) and they have "110,000 subscribers as of March" as the Neowin article said a few days ago. So, 3 Billion is a ridicules amount of money. =)

yardmanflex said,
Hater...

you don't have to be a hater to call beats by dr. dre piece of ######. FYI many of my friends who have been apple fan are disappointed because guess what ? they don't like beats as well. not everyone can be hater.