So About This Apple-Beats Deal…

Although it hasn’t been announced yet, most of the universe seems to think that Apple’s purchase of Beats for $3.2 billion is a done deal. All that’s left is the official announcement.  What’s still not clear is why the f**k Apple would want to buy Beats in the first place.

There’s been a zillion lines of speculation, theorizing and postulating over the last ten days or so.  Here’s yet another angle from the business section of the Sunday New York Times.

Apple’s reported plans to acquire Beats Electronics for $3.2 billion seemed downright strange to some of the people who follow Apple closely. Yet a deal could help jump-start two important industries.

Apple’s own shares fell on the news this month, and some analysts were skeptical about the merits of combining withBeats, which makes Beats by Dr. Dre headphones. Beats also has a streaming service, Beats Music, that is said to be part of a possible deal. Neither Apple nor Beats executives would comment on whether substantive talks were underway.

But Toni Sacconaghi, a tech analyst at AllianceBernstein, was perplexed by the rumors. “We struggle with the rationale for this deal,” he wrote to clients. Apple might acquire businesses that it doesn’t need without gaining the ability to sell more iPhones and other gadgets, he wrote.

Keep reading for a quote from Elias Roman, my boss at Songza.

Alan Cross

is an internationally known broadcaster, interviewer, writer, consultant, blogger and speaker. In his 30+ years in the music business, Alan has interviewed the biggest names in rock, from David Bowie and U2 to Pearl Jam and the Foo Fighters. He’s also known as a musicologist and documentarian through programs like The Ongoing History of New Music.

One thought on “So About This Apple-Beats Deal…

  • May 19, 2014 at 8:53 pm
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    Apple has a great brand but it’s too wholesome (not unlike Disney) and that limits them from succeeding in certain segments of the market. The Beats brand works in a lot of places Apple doesn’t. I’m just speculating but I think Beats could be to Apple what Volkswagen is to Audi. Apple has the resources to create a separate line of Beats branded products that leverage Apple’s manufacturing and OS expertise but is more Android-like and adult than Apple… plus it would all work across the Apple eco-system. The industry is entering the same stage as the auto industry when General Motors emerged with its multi-brand strategy. Just my hypothesis.

    Reply

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