Light Reading
The iPhone maker has made its biggest acquisition ever, spending $3B to buy Beats for its headphones and streaming music business.

Apple Confirms Beats Buy for $3B

Sarah Reedy
5/28/2014
50%
50%

Nearly three weeks after Dr. Dre's infamous video-selfie news leak, Apple has confirmed its acquisition of Beats for $3 billion, slightly less than originally thought, but still its biggest M&A deal to date. (See Apple Buying Beats for $3.2B: Dr. Dre & Tyrese.)

Apple Inc. (Nasdaq: AAPL) confirmed the acquisition on Wednesday evening, a few days before its annual developers' conference where more big news -- including a push into the smart home -- is expected.

The iPhone maker is getting both Beats Music, its subscription streaming service, as well as Beats Electronics, the brand's line of headphones and speakers popular with youngsters. It's also getting two new executives, Beats co-founders Jimmy Iovine and Dr. Dre, the self-proclaimed richest man in hip hop.

Iovine said in a release that his company was inspired by Apple's "unmatched ability to marry culture and technology" when it was formed in 2008, and Apple CEO Tim Cook noted that the pair will "continue to create the most innovative music products and services in the world."

Since the impending deal was first unveiled in early May, there's been a lot of talk over why Apple would splash down so much cash on a headphones brand that some say has lost its cache, especially considering it has its own iTunes Radio streaming service. The answer, according to the Cupertino giant, seems to have the most to do with its streaming service and catalog of music. (See Apple iTunes Radio Brings the Beat to LTE.)

Apple said it will offer Beats products in its online store, retail outlets, and select resellers, but, in announcing the acquisition, talked the most about the talent on the team and how it will bolster its music line up with its subscription service as well as within iTunes Radio and the iTunes store itself.

The deal is made up of $2.6 billion in cash and $400 million to vest over time. Its subject to regulatory approval, but Apple expects it to close in the fourth quarter.

— Sarah Reedy, Senior Editor, Light Reading

(6)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
5/29/2014 | 2:23:06 PM
Suggested name for the new company
@XeniJardin has a good idea.
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
5/29/2014 | 2:00:11 PM
Re: Apple Confirms Beats Buy for $3B
@Dan, that seems to be their focus and you make good points.

We will have to watch and see if that is truly where the value is created as this goes forward.
SReedy
50%
50%
SReedy,
User Rank: Blogger
5/29/2014 | 9:56:32 AM
Re: Apple Confirms Beats Buy for $3B
Very true. That was clear from Cook's interviews on the deal. Dr. Dre and Jimmy Iovine are now full-time Apple employees...I wonder how they'll like having bosses again!
DanJones
50%
50%
DanJones,
User Rank: Blogger
5/28/2014 | 11:48:54 PM
Re: Apple Confirms Beats Buy for $3B
You're missing what they're getting in terms of powerhouse music and film people. Take a look at what Jimmy Iovine has done in music and film.

Then add in Dr Dre as a hip hop powerhouse. I suspect this buy is as much people driven as a technology buy.
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
5/28/2014 | 8:37:50 PM
Apple Confirms Beats Buy for $3B
Sarah, I am with you on this; I don't see the need to buy them to stream music.

I believe it is much more strategic.  In reading the interview, I would see a more "hidden" agenda in the comments on talent, and what they can create for the future.  There must be more to this deal, in my way of thinking.
SReedy
50%
50%
SReedy,
User Rank: Blogger
5/28/2014 | 6:17:32 PM
Cook on Beats
Here's some more on the acquisition from Tim Cook himself...still seems a little weird to me. http://recode.net/2014/05/28/tim-cook-explains-why-apple-is-buying-beats-qa/
Flash Poll
LRTV Huawei Video Resource Center
Sales Director of INIT on Plug & Play Switch Devices

9|19|14   |   3:21   |   (0) comments


INIT Italy uses both the Huawei S5700 and S7700 series switches for the campus LAN environment. Sales Director Andrea Curti says their company chose these Huawei devices over others because of their performance, flexible scalability and plug-and-play features.
LRTV Huawei Video Resource Center
Saudi Arabia Upgrades Vocational Training System

9|19|14   |   3:31   |   (0) comments


The Technical and Vocational Training Corporation (TVTC) has 100,000 students, 150 government-owned institutions and oversees 1000 private institutes. The CIO of TVTC explains that Huawei devices have allowed them to manage multiple datacenters using just one software program, scientifically tracking the progress of students and teachers, saving them millions.
LRTV Huawei Video Resource Center
Huawei's Media Solutions Are Here to Stay

9|19|14   |   4:35   |   (0) comments


The current media revolution requires rapid upgrades in technology. New formats (HD, 3D, 4K etc.) and the subsequent explosion of file sizes demand sophisticated network and storage architecture. Social media and the multiple distribution channels require a robust asset management system. Gartner analyst Venecia Liu speaks about the current technological trends in ...
LRTV Huawei Video Resource Center
Microgenesis on Huawei's Switches

9|19|14   |   3:57   |   (0) comments


Microgenesis is a solutions and system integrator company in the Philippines whose areas of expertise include data centers, networking and security products. In this video, Executive Director Jeffrey Choa talks to us about his customers needs and they benefit from using Huawei switches.
LRTV Huawei Video Resource Center
Network Solutions Help the Philippines Jump Ahead

9|17|14   |   2:59   |   (0) comments


In the past, the Philippines has under-invested in technology. Now, the CEO of Softshell talks about how Huawei products help the Philippines jump ahead as the economy improves.
LRTV Huawei Video Resource Center
VCS Observation for Safer Cities in the Netherlands

9|17|14   |   5:20   |   (0) comments


Holland's VCS Observation has been operating for 22 years. Its main goal is to get cities safer. CEO Wim van Deijzen tells us some of the challenges his company faces and how Huawei is helping to overcome these challenges.
LRTV Huawei Video Resource Center
A Conversation With Serbia's Ministry of Interior

9|17|14   |   4:38   |   (0) comments


At HCC 2014, the Assistant Minister of the Ministry of Interior of the Republic of Serbia talks to us about his projects and corporation with Huawei. Solutions like Safe City and E-Government and services like cloud computing are just some of the areas his department is interested in.
LRTV Huawei Video Resource Center
IHS Analyst Discusses eLTE at CCW 2014

9|10|14   |   7:09   |   (0) comments


Thomas Lynch, associate director of critical communications at IHS Technology, talks about broadband in critical communications.
LRTV Huawei Video Resource Center
TCAA on Huawei eLTE: A Broadband Solution for Mission-Critical Communications

9|10|14   |   2:29   |   (0) comments


At CCW2014 in Singapore, the TCCA's Phil Kidner talks about the importance of broadband data for critical communications.
LRTV Custom TV
Spotlight on Cisco: SDN for Optical Networks

9|8|14   |   9:27   |   (0) comments


Cisco's Greg Nehib talks OpenFlow and more on the 'Software-Defined Networking for Optical Networks' panel at the Big Telecom Event in June 2014.
LRTV Custom TV
Cisco's Evolved Programmable Network (EPN)

9|8|14   |   4:05   |   (0) comments


A look at the various demos Cisco showed at Light Reading's Big Telecom Event highlighting Cisco's EPN innovation and how SDN and NFV technologies are enabling a variety of new services.
LRTV Huawei Video Resource Center
The Future of Ultra-Broadband, With Kevin Kelly (UBBF2014)

9|5|14   |   1:13   |   (1) comment


If you think the technological changes we've seen up to now are astounding, just wait until you see what the future has in store. Discuss upcoming breakthroughs with Kevin Kelly, Founding Executive Editor of Wired Magazine, at the Huawei Ultra-Broadband Forum on September 24.
Upcoming Live Events!!
September 23, 2014, Denver, CO
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
June 9-10, 2015, Chicago, IL
Infographics
A survey conducted by Vasona Networks suggests that 72% of mobile users expect good performance all the time, and they'll blame the network operator when it's not up to par.
Today's Cartoon
Vacation Special Caption Competition Click Here
Latest Comment
Hot Topics
AT&T: We'll Bundle Fixed Wireless & DirecTV
Mari Silbey, Independent Technology Editor, 9/15/2014
New NFV Forum Focused on Interoperability
Carol Wilson, Editor-at-large, 9/16/2014
NFV & The Data Center: Top 10 Takeaways
Sarah Reedy, Senior Editor, 9/18/2014
Connecticut Cities Crowdsource Gigabit Nets
Jason Meyers, Senior Editor, Utility Communications/IoT, 9/15/2014
Pics: LR's Women in Telecom Breakfast
Sarah Reedy, Senior Editor, 9/16/2014
Like Us on Facebook
Twitter Feed