Rap chap tapped for $3 BEELLION: Apple buys Dr Dre's Beats

Apple, ending weeks of speculation, has confirmed it will acquire Dr Dre's Beats Electronics for $3bn (£1.79bn). The iPhone maker on Wednesday issued a formal announcement revealing it will shell out $2.6bn in cash, and an additional $400m in payments that will vest over time, to bring Dre and company on board. The final price …

[taxman]

WTF?

Most expensive hearing loss tool paid for. Is this a tax loss thing?

As for music streaming.... surely the geeks employed by Appfelsaft could have aye Tunes do this...hang on. Doesn't this exist already?

Jeez. 3 Bs!!! Looks like mushrooms are back in favour.

[dan1980]

Re: WTF?

Music download service buy competing music download service.

The other thing to note is both companies sell a product at a premium over competing options and have proven that people will pay over the odds for their device. I mean, think of the cross sell at Apple stores.

[Anonymous Coward]

Re: WTF?

The King of the Lossy Codec purchases a bass-boosting acoustic-disruption hardware biz for $3 billion.

What's to lose? Besides 10%-20% more of the musical quality.

[Slabfondler]

Re: WTF?

Um, not exactly...Apple's proprietary, and, until recently, closed-source codec is lossless - Apple Lossless Audio Codec or ALAC for short, or even better - ALE (Apple Lossless Encoder).

You must be confusing that with the codec sharing the same .m4a extension (and the same container) which is Advanced Audio Coding, the successor to mp3, not developed by Apple at all, but a consortium including Sony, Dolby and Nokia along with Bell Labs and the Fraunhofer institute. Though to be fair to your comment that is the default codec on pretty much every Apple device out there.

[SuccessCase]

Re: WTF?

"The King of the Lossy Codec purchases a bass-boosting acoustic-disruption hardware biz for $3 billion."

And that is precisely why Apple are buying Beats (apologies BTW, but this is in large part a repost of a post I made earlier, but is even more relevant to this article). Agree on the base-boosting acoustic-disruption line (but that doesn't change their popularity does it), but your line on the "lossy codec" says it all: The tech world has been caught on the hop by the popularity of Neil Young's PONO kickstarter project. Ultra-high def audio is proving a bigger draw with consumers than anyone imagined would be the case (the science case for it is not at all clear and more than a little contentious). Apple have a penchant for pushing standards to new levels and always seek to reduce the number of connections and simplify. They were the first to drop optical drives from their laptops. They were the first pushing FireWire. They moved from Intel to Power PC and back in their Mac/MacBook line and now look likely to move to ARM. They always move on and never fear burning some of their existing market to get to where they consider the leading edge to be.

I predict they are about to go all in on ultra-HD-Audio. The 3.5 inch headphone jack is now the oldest connector on their devices. They will probably replace it with a connection via the lightening port. Overnight 3.5 inch headphone connections will appear old fashioned and low tech. There will be a wave of upgrades. Apple sell half their kit via the Apple Stores where they can play kingmaker with which head-phone brand is given most prominence. Beats will needless to say have the new connector type. Users will still be able to plug in with a 3.5mm cable (via an adaptor for Apple kit and an alternative cable in the box with the Beats cans). But many consumers are nevertheless going to have at the back if their minds that they should go for the new standard; That 3.5 mm jacks have had their day. They will offer instant "quality" upgrade via their iTunes iCloud service (where tracks are streamed so can be upgraded to higher quality non-lossy bitrate for "free") and needless to say the Beats streaming service will offer the same. Even those who are dubious of the value of ultra-HD audio will have a nagging feeling they no longer have the best if they don't have it - that is simply human nature.

Further I believe Apple will publish the standard for others in the industry to be able to use the connector. Which they may well do, if reluctantly. At the very least Apple will succeed in muddying the waters re USB. This will simultaneously help them in their problem with the EU, who are soon to mandate a common connector for mobile devices. Apple will not want it to be mini USB 3 because it is a turd compared with their physical socket design and they way in which it isn't appropriate for headphone connections (where users often grope to insert the cable, sight unseen) will illustrate their point. When other companies have to compete by moving away from USB 3 to Apple's design or their own new design, the fact Apple are right on this will have been made clear. Apple will gain a small advantage over other companies playing catchup to implement a new standard and will have the appearance of being industry leading. Some companies will stick with 3.5mm audio connectors and hold the line there is no discernible difference (and they will most probably be entirely correct), but their sales will suffer anyway because with new standards out there the 3.5mm will simply start to feel old and new kit using it will suffer from the, albeit technically unjustified, whiff of premature redundancy.

If Beats is going to encounter, over the next two to three years, a huge spike in revenue in large part due to upgrade purchases, and also due to new ultra-HD customers being attracted to buying (albeit bass heavy) "quality" kit, it makes sense for Apple, who will be creating the conditions for that upgrade revenue spike, to own the company.

[Sorry that handle is already taken.]

Re: The Surprising Popularity of Neil Young's PONO Kickstarter

Popularity != quality. Even better, popularity on Kickstarter != product!

Dan has some sober and impartial words to say about PONO. He then cops some abuse for his trouble.

[ukgnome]

@SuccessCase

TL:DR

[SuccessCase]

Re: @SuccessCase

"@SuccessCase

TL:DR"

Thank you for letting me know that. And I wish I could care more, I really do, I just don't.

[Kristian Walsh]

@SuccessCase

Sorry, that's an Apple-fan's fantasy. First, Beats are not large enough to move a market. Second, iOS's market share and mindshare is no longer large enough to move a market. Third, Every audio maker who was bitten by Apple ditching the 30-pin dock will just walk away from a proposal to change. Look at how poorly the "Lightning" connector has been adopted by accessory makers compared to the 30-pin. And that was just swapping one proprietary connector for another.

Are you really expecting the industry to lock out the 99% of consumers who don't exclusively use their headphones on an iPhone or iPad?

By far the most likely reason Apple bought Beats is simple: Despite repeated efforts, Apple has near-zero presence in the subscription streaming market at a time when music sales are plummeting fast in favour of these services. Rising App Store revenue has been masking the decline, as iTunes and AppStore are normally reported as a combined figure, but break out the music sales and you see that they have been falling steadily for years. The graph in this article illustrates this very clearly: http://9to5mac.com/2014/05/28/declining-itunes-sales-underline-need-for-apple-to-launch-a-streaming-music-service/

[SuccessCase]

Re: @SuccessCase

"iOS market share and mindshare is no longer large enough to move a market."

Just why is it app vendors still predominantly write for iOS first ?

"By far the most likely reason Apple bought Beats is simple: Despite repeated efforts, Apple has near-zero presence in the subscription streaming market at a time when music sales are plummeting fast in favour of these services."

It's a standard term in music industry contracts, that they have to be renegotiated in the event of a change of owner. So no banana. Yes they will want to take over Beats subscription streaming, but it isn't really anywhere in user numbers, so again no banana.

[Anonymous Coward]

Re: @SuccessCase

To be fair there is not much which you can only get on iOS that I miss with my Andriod...

But, don't forget this isn't about getting people to make your apps. This is getting all devices using a headphone socket to stop and use some stupid connector which reduces sound quality. I can't see Cyrus (nor any other decent Hi-Fi maker) dropping their headphone socket, which is after their DAC, and replacing it with a digital socket so a cheap, crappy external DAC (which is what will be in most headphones) can be used to generate a far lower quality signal.

And of course means all headphones now have to be powered...

[Kristian Walsh]

Re: @SuccessCase

"Just why is it app vendors still predominantly write for iOS first ?"

They don't.

http://www.developereconomics.com/reports/q1-2014/ : "Android continues to dominate Developer Mindshare with 71% of developers that target mobile platforms developing for Android."

iOS developers may be more loyal to that platform, but that's natural, as the iOS market contains a lot of old Mac developers who hit the big-time when iPhone's App Store opened. Their preference for iOS does not change the fact that it is that Android which is targeted by more developers than any other platform. (For tablets, iOS is still the preferred platform, but not by enough to redress the balance, and we are talking about headphones which are primarily a phone accessory).

The flaw of your argument regarding a new "super headphone" connector is that there is no part of it that requires Apple to acquire a headphone maker. All they'd have to do is bribe/incentivise an existing maker like Beats to produce headphones with your super-duper connector, make some themselves and an sell an exorbitantly priced adaptor for good measure.

Apple don't care about setting a standard. I'd go further and argue that the last thing Apple wants to become is a de-facto standard -- that opens you up to monopoly complaints, and you get sued and eventually have to licence your technologies on a FRAND basis (which usually means not earning much from them).

As I said, though, the days when Apple could move a market like this are now gone - iOS has a good share of a mature market, but it's static; it isn't making any new conquests anymore, and a lot of the companies that invested in the iOS accessory market never made their costs back.

I believe that you live in the USA. This is where Apple's market share is the healthiest in the world (thanks largely to a carrier pricing model which makes iPhones the best value of all options), and it can distort your perception of how the platform is doing overall (Apple has always been strongest in the US: even when Apple was in the shitter in the late 1990s, I remember that we were still selling reasonably well into the US market). The situation in Europe is very different, where fairer pricing has made Android is dominant, and iOS is even outsold by Windows Phone(!) in a few markets, notably Italy.

And regarding the bananas, I'll just assume that you were offering me a nutritious fruit that's rich in potassium, rather than calling me a monkey.

[Anonymous Coward]

Re: WTF?

Not sure why people are down voting you. I could indeed see Apple phasing out the 3.5mm jack for something more proprietary. It's the oldest trick in the book and Apple have never been frightened to dump connectors that don't fit their world view whilst pushing their own.

[Kristian Walsh]

Re: WTF?

They wouldn't have needed to buy a headphone maker to do this, though...

[Anonymous Coward]

Re: WTF?

I think most people downvoting him are doing so because the post is long and reading is hard for them.

I'll actually go as far as saying I would LIKE if my phone (Samsung) had one less port on it. I'm concerned about the little rubbery flap on my otterbox wearing out from use though.

I think they'd have to reassess where that port is though. The headphone jack usually goes on top so it is easier to wear headphones with phone in pocket. I think Apple's is on the bottom though?

I wonder how long it is before we go bluetooth for all headphones though?

[Anonymous Coward]

Re: WTF?

trouble is Bluetooth headphones require power ie battery. I have a pair of sennheiser pxc360 BT's they're good but the battery doesn't last that long

[Anonymous Coward]

Re: WTF?

" The headphone jack usually goes on top so it is easier to wear headphones with phone in pocket"

Do you have issue putting a phone in a pocket the other way? Usually I put a phone in my trouser pocket with the phone bottom up, because when I put or get it it's much more natural this way... or do you believe it won't work if you put it in the other way? LOL!

[Wilseus]

Re: WTF?

>[Apple] moved from Intel to Power PC and back in their Mac/MacBook line

From Intel to Power PC? That's news to me.

[SuccessCase]

Re: WTF?

Oh gawd did I write that? I lived through it too, so actually know they were on Motorola first but was forgetting the dates and thought they went briefly to Intel before going to Power PC. Now thinking about it, I remember it was just a lot of *talk* about them going to Intel, (and there was also a lot of talk about PowerPC trouncing the Intel architecture, so of Windows converting to PowerPC). It didn't happen though, not because Power PC wasn't superior. Risk did offer real advantages, but because Intel effectively introduced Risk philosophy behind a kind of facade and basically kept ahead of the performance curve through shear money and scale talking.

[Monty Cantsin]

Re: WTF?

Um, the PowerPC processors were the ones that were made by Motorola (and IBM) that apple used to use (they used Motorola's 68k processors before that). Apple then switched to Intel in 2006, and are still on Intel processors to this day.

Also, it's RISC, not Risk.

[JW 1]

Re: RISK

Geeky board game, yes. What you're looking for is RISC (Reduced Instruction Set Computing). Since you spelled it wrong twice you lose some credibility especially after such a tediously long post. And yes tl:dr.

[Anonymous Coward]

Has

Hasn't someone pointed out to Apple that Beats headphones are mediocre? Style over substance? Show but no go?

Still it fits in nicely with their philosophy, after all it's all about marketing and not the product.

[g e]

Re: Has (Style over substance)

You answered your own question

[Anonymous Coward]

Re: Has

hahahaha yep should fit well with Apple. Beats headphones are toilet, if you want decent headphones go for Sennheiser.

[JDX]

re:fits in nicely with their philosophy, after all it's all about marketing and not the product.

Every business is about making money

Music is an area where style has ALWAYS been at least as important as substance

[John Bailey]

Re: Has

"Hasn't someone pointed out to Apple that Beats headphones are mediocre? Style over substance? Show but no go?"

But you can see the logo from ten feet away.. What else matters?

[Tom 38]

Re: WTF?

As for music streaming.... surely the geeks employed by Appfelsaft could have aye Tunes do this...hang on. Doesn't this exist already?

They've not bought it for the headphones, they've bought it for the streaming service.

They haven't bought the streaming service for its technology nor customers (although the latter helps). What they've mainly bought it for is to get access to contract terms that the music labels would give to Beats, Rhapsody and Spotify, but would not give to Apple.

[Anonymous Coward]

Re: WTF?

"What they've mainly bought it for is to get access to contract terms that the music labels would give to Beats, Rhapsody and Spotify, but would not give to Apple."

I agree, but what stops them from pulling those contracts? They may have outs in them or may just not renew after expiry. Risky move that shows how desperate Apple is.

[JDX]

Re: music streaming.... surely Appfelsaft could have aye Tunes do this...

G+ is technologically as good as FaceBook. OSXLinux are at least as capable as Windows. WinPhone8 and Lumia devices are on a par with their competitors... yet in all cases it is hard even for multi-billion dollar behemoths to carve a decent place in the market. Brand is very important.

[Mike Lewis]

A marriage made in Heaven?

Newsflash: company making overpriced computers buys company making overpriced headphones.

[Adam 1]

Re: A marriage made in Heaven?

That is ridiculous. Apple haven't been a computer company in years.

[Anonymous Coward]

Re: A marriage made in Heaven?

"That is ridiculous. Apple haven't been a computer company in years."

Hmm, well technically a smartphone is just a small - albeit powerful - computer with a mediocre cellphone bolted in so in reality they are , they just prefer to give the impression they're a "lifestyle" company now. Quite how using a phone or a tablet is a lifestyle I haven't yet worked out. Does anyone pick up a landline phone and think "Heeey laaadies, arn't I cool or what?". No. So whats the deal with cellphones? Don't get it.

[Adam 1]

Re: A marriage made in Heaven?

Technically a TomTom is a computer too...

But AAPL is not trading where it is because of their worth as a company that sells computers.

[Anonymous Coward]

Re: A marriage made in Heaven?

"Technically a TomTom is a computer too...

But AAPL is not trading where it is because of their worth as a company that sells computers."

Yes it is a computer , but you don't generally download and run disparate programs - sorry "apps" - on a satnav unless its been hacked. Smartphones are pretty much general purpose computers unlike satnavs.

[Anonymous Coward]

Re: A marriage made in Heaven?

Then why do iPad shipments count in most PC marketshare reports?

[Mitoo Bobsworth]

"canned statement"

Says it all, really - canned p.r. & marketing to follow. Be mindful of highly processed goods, folks - not good for your health. An Apple is best when it's fresh.

[Zack Mollusc]

Pffft! Idiots!

I am working on an awesome new technology which will make streaming obsolete, it involves using some of the gigabytes of storage usually used for selfies and tracking cookies to instead store digitised music.

[Dave 126]

Re: Pffft! Idiots!

How can you fit millions of music tracks into mere Gigabytes of space?

[Zack Mollusc]

Re: Pffft! Idiots!

The same way streaming fits millions of tracks into a 500MB data allowance.

[dan1980]

Re: Pffft! Idiots!

@Zack

I think he means the choice of millions of tracks.

I don't stream - I like to own and rip my own CDs and I supplement that with radio (FM) - however I do see the value in streaming.

Think of it this way - you are only playing, at most, a handful of tracks at a time. All the other tracks you have that you are not listening to right now are really only there so you can choose them. So, with a local solution, you have a choice limited by your storage capacity. With streaming, you have a choice limited by the storage capacity of the streaming service, which is fairly guaranteed to be larger than yours.

What tracks are actually available is a different matter of course, but the conversation seemed to be around storage.

Of course, on a small data plan that's not really do-able!

[Michael Wojcik]

Re: Pffft! Idiots!

Think of it this way - you are only playing, at most, a handful of tracks at a time. All the other tracks you have that you are not listening to right now are really only there so you can choose them.

I only play one track at a time, but who knows what you crazy kids get up to.

I have my MP3 player¹ with 300 tracks or so on it, and it's set to play through the lot, then go back to the beginning. If I didn't want to hear it, why would it be on there?

¹Since I generally only listen to music while I'm driving or working on the house, I prefer to use an extremely cheap standalone MP3 player for this purpose, rather than any more-useful device. But yes, my pocket-telephone is also a gramophone. And a telegraph machine! Also it tells the time. It's quite ingenious really.

[Anonymous Coward]

Re: Pffft! Idiots!

Personally I'm really divided about this. I have tons of storage space on my phone's SD card, but tend to use streaming services. Mostly because I don't know how to buy the type of music I listen to (EDM mostly, not able to be found on store shelves) but also because the ads are unobtrusive for the most part so the music is free to stream. But my data rate is not free, but is a sunk cost.

First world problems.

[Dave 126]

>Apple makes it official: $3 BEEELLION for Beats

>Add 'billionaire' to list of things you may have forgotten about Dre.

This deal doesn't make Dr Dre a billionaire, accordng to his hare in Beats.

Headline writer is not the article writer.

[emmanuel goldstein]

here hare here

[Vladimir Plouzhnikov]

As for all their tempting ideas, well Hare didn't care. The lost spectacles were

his own affair. And after all, Hare did have a spare a-pair. A-pair.

[Mark 85]

Ah.. one word..

Quote: "Music is such an important part of all of our lives and holds a special place within our hearts at Apple,"

He obviously means <cough> PROFIT!!! <cough>

Sometimes I wish they say what they really mean...

[dan1980]

Re: Ah.. one word..

@Mark 85

"Sometimes I wish they say what they really mean..."

Really? Most of the time I just wish they'd all shut up and go away.

[Frank N. Stein]

Wow. I should've created some badly designed brittle headphones with bass boost, first. I could've been this Beelion_aire..

[Anonymous Coward]

You'll need to be a ghey rap star first.

[Anonymous Coward]

All you need are two dustbin lids, hey presto, you have a Beats headset.

[Anonymous Coward]

It's time for Dr Dre to say...

"... suck on this, Jay-Z and Kanye!"

[Anonymous Coward]

Re: It's time for Dr Dre to say...

They say that to each other in private just about every week. I wish I could dis them more.

[Steven Raith]

Hmm...

"The acquisition will include Apple's assimilation of Beats' headphone and audio hardware lines"

Do you think Apple would pay a few hundred thousand for one of my more massive, post-roast-dinner turds?

It'd sound better than anything Beats Electronics has shat out. And it doesn't even make a sound.

Ghost poo.

Sorry, it's late and I hate Beats.

Steven R

[JDX]

Re: Hmm...

For you to hate them it's clearly not just about their audio quality because there are hundreds of crap headphone companies. Without realising it you are responding to the brand just as much as people who like it.

[Steven Raith]

Re: Hmm...

Damnit damnit damnit! I'm part of the consumerist bourgeoisies!

I'm off to buy some Monster cables, a £3000 sound bar and an Aston Martin Cygnet*

Steven R

*it's a Toyota IQ with some minor trim changes and a tripled price tag. Seriously, look it up, it's just awful.

[Steven Raith]

Re: Hmm...

NB: I'm putting a shiny penny on at least half of my upvotes coming from managing to drop in the phrase 'ghost poo'.

It pleases me any time I get to share it.

Steven R

[SVV]

Apple makes it official : The IT industry has finally gone insane

Billions for snapchat, billions for instagram, now finally billions for ear destroying headphones and, gosh, wow, a music streaming service, I see a lot of investors money going up in smoke sometime very soon.......

For goodness sake, if you want to buy some decent headphones, there is plenty of choice, and as for music streaming, well nobody's ever found a way to get hold of music any other way have they?

[Anonymous Coward]

Apple is no longer a product company

It is now only a hype generator.

It smells like a cynical Apple stock pump-and-dump scheme. Wall Street analysts will Applegasm for the next six months about the deal. Time to make some dough trading Apple Options.

If this really was about music streaming, they could have bought Pandora for much less. It can't be about those awful Beats headphones either.

How much does it cost to build a music streaming service anyway? Yes, there are licensing and lawyers fees but these can't possibly add up to 3 billion, and the streaming service Apple will be providing won't be given away for free.

[Truth4u]

Re: Apple is no longer a product company

the mac pro looks like a decent computer if only it wasnt priced double compared to the same parts in an ATX case. But you're paying to get rid of that big noisy case I suppose. Paying far too much. But it is at least a product that they made. If it didnt cost 5x the cost of a regular computer people might even buy it.

[Steve Todd]

Re: Apple is no longer a product company

I guess you haven't tried pricing up Xeon motherboards and processors, nor workstation class video cards. Last time I checked I couldn't build an equivalent box out of parts for much less than the Pro.

[Anonymous Coward]

Re: Apple is no longer a product company

Apple hasn't been a product company in decades, since at least those big boxy rainbow colored iMacs. They've been a marketing firm for quite some time.

[Anonymous Coward]

Re: Apple is no longer a product company

Right, so, making 1.8" hard drive MP3 players when everybody else was doing flash or 2.5" -- not products?

Making iPhones when everybody else was doing Blackberry-alikes -- not products?

Making iPads when "tablet computer" meant a laptop running Windows Tablet Edition -- not products?

Making MacBook Airs when [almost] every other laptop on the market was an inch thick and 5 lbs -- not products?

Making a workstation (Mac Pro) that's small and effectively silent when its competition is in loud, heavy, full-size tower cases -- not products?

Making the most popular graphical front end for FreeBSD with the most third-party software support -- not products?

I guess this is all marketing to you?

[James Boag]

It's obvious

This is not about Music streaming, Apple have just bought one of the worlds largest sucker lists, now they can sell icrap to all the beats victims !

[Jason Hindle]

Great

So three of those American billions, some mediocre cans, a streaming service that isn't as good as Spotify , and two sweary former owners. What's not to like?

[adnim]

Studio headphones

are for mixing and music production, they should have a flat EQ, not colour the sound or alter the sound stage. When mixing one has to hear the music not the headphones. Beats headphones are designed to have a bass boost and top end lift hence they colour the sound. If they colour the sound they alter the sound stage. How can they be called studio headphones?

Sennheiser, AKG, Beyer Dynamic all make far superior and more neutral headphones. And all have models that start at a third of the price of Beats.

Form over function is becoming all to common for the "look at me I am cool" crowd.

I have a 12 year old pair of Technics headphones(ear cups are very tatty now) I wouldn't swap them for a pair of Beats unless I was paid enough to upgrade my Technics.

[g e]

Re: Studio headphones - On the other hand...

I find it really helps to have people use visible gadgets like these to help me avoid the mindless arse-clowns who comprise their pitiful demographic.

[JDX]

Re: Form over function is becoming all to common for the "look at me I am cool" crowd.

You're old. This is NOT new in the slightest.

[142]

Re: Studio headphones

"When mixing one has to hear the music not the headphones "

Not everything in the studio involves mixing, or indeed needs flat monitors. For writing / production - hyped speakers can be great. Vibe is far more important than accuracy. I know on the big A-list hip-hop recordings in Record Plant in LA, the sound is always played back at max volume through the giant far fields, which are eq'd to hype the bass. They are anything but flat!

[Sorry that handle is already taken.]

Re: Studio headphones

How do you measure vibe?

[Timmay]

Beats do streaming music??

What's amazing is I hadn't even heard of Beats' streaming service before news of this deal broke, and apparently it's highly successful and/or worth a massive amount of money.

Sheesh, now I feel old and out of touch.

[Kristian Walsh]

Re: Beats do streaming music??

You probably live outside the United States of America, which is the definition of "EVERYWHERE" according to Beats.

Not that it's enormously popular in the USA either, but that's the only place where it's available.

[Anonymous Coward]

Re: Beats do streaming music??

I live in the US of A and I've never heard of Beats' streaming service until now.

Will they be known as iCans after the iAcquisition?

Confession Time: I own two pairs of SONY cans, priced at about USD $30 each. Different models, supposedly, but not really that different. Ya know what? They're just fine, and I've been mistreating them in my laptop backpack for two years. I'm sure they aren't the best cans one could get, but they really aren't bad at all. And I listen to classical music on them too. True, I had to fiddle around with the equalizer.

I'm not shilling for SONY. Just sayin' that one doesn't have to blow USD $200 on sub-mediocre crap.

[Truth4u]

Sad day for capitalism

This is a slap in the face to the companies worth less than $3 billion who are doing more for society than Dr Dre.

Everyone from Cancer Research to Pepper Pig is losing out to a man whose 'job' involves making songs about a 'tough but colorful ghetto lifestyle' that seems to exist solely in his imagination. And he'll even sell you some plastic headphones so you can listen to him fuck up a perfectly good song by taking out the chorus, looping it for 5 minutes, and chatting shit over the top.

[Timmay]

Re: Sad day for capitalism

While I don't wholly agree with the fervent anger there, it did make me smile, so I applaud and thumbs up your rant

[Vladimir Plouzhnikov]

That pile of cash

Apple is sitting on? The shareholders are never going to see any of it. It's just too enticing a target and anything that taxman and lawyers won't be able to get to will be wasted on buying overpriced assets with ever more increasing desperation. This has begun.

There is simply no way how that crap rap brand and its strap-on beer cans can be worth USD 3 bn even if you add their internet file server *AND* the idea that the deal will increase Apple's penetration into the demographic currently buying beats-branded things.

It is also sending quite a disturbing message that crimes against music and sound reproduction actually can pay....

[masterofobvious]

Maybe they're doing us a $3bn favour...

And shutting Beats down?

[Truth4u]

Think Connectors

I bet they bought Beats so they can stick a 40 pin proprietary connector on the headphones and change it slightly every year, then people will have to buy the same headphones again and again if they want to stay cool!

It also means Apple can charge the same price and reduce the quality as they know they're going to discontinue the connector in 12 months, they can use plastic that will crack after 11 months of use. And the prices will never ever go down, only up.

[Grubby]

Makes sense

I said a few weeks ago it made good business sense to happen and I still think it is. When you look at the 2 things apple have bought, firstly the hardware, mid-range, over-priced with a strong customer, almost fan, base who believe that the best products are the shiny, most expensive ones with a well known person at the helm. So lots in common with the apple customer base then.

Secondly they have bought the streaming service, and I think over the next few years they'll make their 3bn investment back a few times over just with this. They have recognized a shift in people's listening habits and realized that although have their own, they've lost ground on some competitors, combined with the trillions in the bank it was a no brainer. if you can't beat 'em, buy 'em.

[Anonymous Coward]

Overpriced

Nice to see it's Apple paying over the odds for once rather than their customers.

[Adam 1]

Re: Overpriced

...rather than their customers

Where do you think apple's money comes from? They will pay for it eventually.

[Anonymous Coward]

A maker of overpriced tat gets bought by a maker of overpriced tat. Not much more needs to be said.

But...

The fact that people like to buy both sets of overpriced tat makes the move a good business decision, and I think it says something about the world in which we love that this is a good business decision and that we care about it.

[Ian Halstead]

Now do it properly...

Sell the Dr Dre Beats headphones section — might be worth talking to Alan Sugar or Gerald Ratner — and buy Grado, a headphone manufacturer that builds quality headphones capable of reproducing music, and give them the investment. Then leave them alone to get on with it.

[Vladimir Plouzhnikov]

Re: Now do it properly...

Oh, please leave Grado out of it. Last thing we need is for Apple to destroy Grado...

[Truth4u]

Re: Now do it properly...

And Alan Sugar would want to cut down on the cost of wood in the Grado headphones by replacing it with chipboard and no doubt replace the ear cup with some kind of HIV-based material. Then Ratner would put out a press release announcing his intention to sell crap headphones. But only Apple and Dr Dre would actually rip you off on the price.

[mhoneywell]

Excellent sub-head

I definitely didn't forget anything about Dre. But I'm jolly impressed with your Dre based knowledge.

[Anonymous Coward]

Hurrah

Not only is Dr Dre set to be a billionaire doctor of musicology, but if i remember correctly his back catalogue also marks him out as a keen supporter of the Law Enforcement community and a champion of womens rights??

Trebles all round...(crotchets and quavers optional)

[RainForestGuppy]

Take millions of pairs of Chinese made $5 dollar head phones.

Associate with Rapper.

Sell headphones for $100

Sell brand to hypermarketing company

Sell iheadphones for $200

Unfortunately there are enough fools out there who believe marketing hype and what is perceived to be "cool"

[Adam 1]

I don't know where to start with your rant. It should be glaringly obvious that it costs far less than $5 to manufacture them at this scale.

[Bod]

Spotify killer

Streaming service is what they're after. Not even the customers as there aren't that many compared to the likes of Spotify, but they then have a streaming service built into iTunes and bingo suddenly all other streaming services are in breach of their app terms for providing a service Apple provides, and all get banned, and then iSheep switch over to iTunes for streaming.

[Vladimir Plouzhnikov]

Re: Spotify killer

It almost sounds like a plausible motive until one remembers that Apple could just set up their own streaming server to achieve the same result without having to spend billions on buying someone else's...

[bailey86]

Tim forgot the golden rule...

What would Steve do?

After reading Walter Isaacson's biography I would say that SJ would have spent 3 bill on making something awesome instead. Heck, for 3 bill they could have bought all their customers a pair of Sennheiser's each.

Saying that - a colleague has pointed out that Beat stuff is *very* popular with the kidz - so maybe a good money making move - but as mentioned - I don't think SJ would have liked the strategy.

[Anonymous Coward]

Not sure why people are down voting you. I could indeed see Apple phasing out the 3.5mm jack for something more proprietary. It's the oldest trick in the book and Apple have never been frightened to dump connectors that don't fit their world view whilst pushing their own.

I think Apple will phase out the 3.5mm jack, but I don't think that's why they bought Beats. Two things are stopping them going thinner on the design of their phones and tablets... The headphone jack and the battery. Battery technology is improving all the time, but headphone jacks are as old as the hills. They'll either get rid of the jack altogether and go bluetooth headphones only (unlikely) or they'll come up with a smaller connector or possibly just use the lightning connector to make it thinner

[Mage]

2.5mm and Baffled

There is a 2.5mm stereo jack that some gear I have inexplicably uses.

1) No cost saving

2) Plenty of space in gadget for 3.5mm

3) They supply "Free" a 3.5mm to 2.5mm stereo patch cable.

Phones are often too thin already. Make them a little fatter so the battery lasts longer please!

[Mage]

Regulator

I can't imagine any "Regulator" will care.

It's not their money being wasted on a Streaming service and Record Company deals that Apple could easily do. Or indeed any other large company can do.

Even BBC was having difficulty explaining the value of this on the News. They even risked an uncomplimentary comment about the "quality" of Beats Headphones and significance of the Streaming service, though they stated the deal was "really" about the Streaming.

[Rick Brasche]

Music may hold an important, special place in our hearts

but here at Apple, nothing is in higher esteem than snake oil!

Next up: Apple to acquire Monster Cable and promote all gold plated fiberoptic digital linkages.

Sell the sizzle, not the steak.

[Triggerfish]

They will sell though

They will sell a lot of people want that bass from their headphones. I'm not saying its right its just the way it is. I can compare the Bose earphones a work colleague has and likes enough he went and bought another pair to replace the old ones with my soundmagic E10s (yes they are cheap but not bad) which delivers a bit more range. I prefer the sound from the E10s my colleague wants it to have boom.

[Nuno trancoso]

Let's just hope this isn't just Apple backsliding into it's old ways and how headless chicken tat sellers go about when no smart person is at the helm... As pointed, 3b would go a long long way into them setting it up themselves and far better.

On the sound quality discussion, to each it's own. Might sound devastating to audiophiles but it's not really about what sound sounds like but about what YOU like sound to sound like. Music is pointless if you hate the sound of it (pardon the pun) when you listen to it. And this isn't even limited to listening devices. That live band you loved yesterday might sound like crap today just because they changed venues, thus acoustics. And maybe today they are closer to their "true sound", but to YOU it now sounds crappy and yesterday's "distortion" sounded a lot better.

[ecofeco]

SUCKERS!

That is all.

Carry on.

[Anonymous Coward]

Oh, for the sounds

Maybe, they will market them as headphones from heaven and hint that it was St. Jobs last dying wish to get decent headphones (no matter how grotesque and big they look) Fanbois will then buy in hordes.

Milking Jobs memory for every penny. Whats not to like?

[Anonymous Coward]

Buying for the brand makes no sense

Apple has a powerful brand, what does it hope to gain by buying another powerful brand except for brand dilution?

One idea--Apple might keep the brands separate and distribute Beats products exclusively in Apple Stores and on their web site. They do sell a bunch of 3rd-party stuff in their stores, might as well also sell those headphones. And it would mean more traffic to their stores and more eyeballs on their products.