Apple Close to Buying Beats Electronics for $3.2 Billion

Apple Close to Buying Beats Electronics

Apple could be close to making the biggest acquisition in the company’s history, offering $3.2 billion to purchase headphone maker Beats Electronics, which recently launched a streaming music service.

Should the deal close, it would mark a major payout for Beats founders and music industry icons Jimmy Iovine and Dr. Dre, who launched the Santa Monica, Calif.-based company in 2008. Its products were produced by Monster Cable until 2012, when founders bought back control of the company from Monster and mobile hardware maker HTC.

A deal could be announced next week, individuals close to the companies say.

The deal stands out not only for Beats’ holdings, but because Apple rarely buys other companies to bolster its bottom line. That’s changed under Apple chief Tim Cook, who has dug into the company’s $133 billion coffers and acquired 24 companies in the past 18 months. He is considering other additions to the company to help its products stand out from rivals, including Samsung, and inject a “cool factor” back into the company that has relied on iTunes, its iPhone and iPads for far too long.

The Beats deal would make a lot of sense for Apple.

Beats has established itself as a major player in the industry with its colorful line of headphones. And its music streaming service, which launched in January for $10 a month, would be used to tune up a streaming service Apple has been developing internally. Beats Music competes with Spotify, Google Play Music, Pandora and Last.fm.

The Beats brand is also licensed to others under the Beats Audio brand and can be found in cars made by Chrysler, Dodge and Fiat, HTC smartphones and HP computers.

Apple and Beats have declined to comment on the talks. The Financial Times first reported the news.

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  1. roxyperez001 says:

    Normally I’d be inclined to disagree when people call Apple products overpriced. If they buy Beats though I don’t in any way see how I could do so. http://bit.ly/1kTi6w9

  2. Blonde, blue-eyed Jesus says:

    It makes sense for Apple to get into car electronics. Make it easier to sync up your iPhone in your car and boost the “cool” factor of cars marketed to young people by having the iTunes brand on their dash.

  3. Ryan Taylor says:

    Terrible company buying terrible headphones, makes sense. It would have been cheaper for Apple to at least try and improve their already crap set of earphones. Wish I had billions to waste

  4. Jake says:

    Yay! Beats will be even more expensive now, and will require different hardware every six months.

  5. How to pump a stock…

  6. homer says:

    LOL yea okay…

  7. Barry says:

    Nope! Not going to happen

  8. Peas and Tanks says:

    Now we know why they ended their relationship with HTC last fall. They were preparing for a partnership with (or rather acquisition by) a much bigger fish.

  9. Kylan Hurt says:

    Beats, formed by Monster Cable which was known as possibly the *worst* company for electronic wiring in the industry’s history, and current maker of arguably the worst big line of headphones… just goes to show most people don’t do their homework.

  10. cxg says:

    Cool. Just another reason I will never buy beats headphones.

    • Deezy says:

      Beats haven’t been made by Monster in ages. They were pushed out long ago when HTC bought a controlling stake in the company.

    • Mario W. says:

      I agree 100%. I don’t care for proprietary Apple products and for them to takeover an established and arguably good product, and put their name on it would definitely keep me away from it. I mean if Apple is such the innovator, why not put this type of product out when the IPOD was released? Sony put out good headphones when the Walkman was released.

  11. The Beats streaming is a real competitor to the Netflix platform if they start to launch Movies as well. If Apple gets access to the Beats community they get a large audience of premium users. This is a major deal if it goes through. Just add the beats audio into a Tesla with an Apple computer brain and see the vision. Tvonthego.com is where you want to go to watch tv.

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