Apple has reportedly acquired Beats Electronics for $3.2 billion. This is a crazy amount of money that Apple might be throwing around, in fact it’s the largest acquisition Apple may have ever made. Nothing has been confirmed, but a video featuring Dr. Dre and actor Tyrese Gibson seemingly confirms the reports. re/code is reporting that the deal might be finalized by next week.
If the reports are true, I think this could be a very good thing. Apple has great connections in the music industry, and both Beats and Apple have great brand recognition. Apple could use their connections to further strengthen Beats product integration with third party offerings, and build upon the new Beats Music streaming service. I am especially excited to see what Apple can do to improve the Beats Music service. A leaked document currently shows that Beats Music only has about 110,000 subscribers which isn’t many. However, the document shows that Beats Music is currently paying songwriters very little in royalties. I believe Apple could use its strong marketing department, and use those connections they have to really get Beats Music integrated with other services such as the Roku, and even incorporating it into the Apple TV to help grow its subscriber base.
I also could see Apple begin bundling Beats products with their own. Such as a pair of Beats IEM’s included with the iPhone or iPad. They may also integrate new Beats audio technologies directly into their devices.
The Verge is reporting that Apple might be acquiring Beats to use their resources for wearables. I agree that this has a distinct possibility of happening. I think it would be a ways off before we would see a wearables product though.
I believe the acquisition, should the reports be true, to be a great thing for both Apple and Beats. It’s really a win-win situation. Apple has the power to grow the Beats brand farther, and Beats has the resources and assets to really help Apple create some neat products and services.