Apple in Talks to Buy Beats Headphones: 5 Fast Facts You Need to Know

Beats Apple

(Getty)

Apple are in talks to buy Dr. Dre’s Beats headphones, according to a report by the Financial Times via CNBC. According to reports, the deal may be announced as soon as next week.

Here’s what you need to know:


1. This Would Be Apple’s Biggest Ever Acquisition

If the deal goes through it would be Apple’s largest ever acquisition. Unbelivably, Apple’s previous biggest takeover goes back to the 1996 acquiring of NeXT Software for $400 million. Toward the end of 2013, Apple began to challenge that record by purchasing the Israeli company Primesense for $345 million and Topsy for $200 million.

Richard Lane, an analyst at Moody’s, talked about Apple’s takeover strategies:

In terms of acquisitions, Apple has been very, very light in their activity. I don’t think they’ve spent $1 billion in any of the last four years.


2. There’s Still Some Issues to Iron Out

Dr. Dre Beats Takeover

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The deal will be announced next week according to the FT. The report further states that there are still issues to be discussed and the deal could fall through.

 

3. Tim Cook Said Earlier This Year That Apple Might Buy

Tim Cook Dr. Dre

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The deal would be a new departure for Apple, a company that previously shied away from high-profile takeovers. Early in 2014, Apple Chief Executive Tim Cook told the media:

We’ve looked at big companies. We have no problem spending 10 figures for the right company, for the right fit that’s in the best interest of Apple in the long-term. None. Zero.

While CNBC has a theory behind the deal:

While Beats commands a leading position in the premium headphone market, its real value to Apple is in revitalising its “cool” at a time when iTunes has waned in popularity and Samsung’s marketing campaigns have savaged the iPhone’s brand.


4. Beats Just Moved Into Music Streaming

Dr. Dre Jimmy Iovine

Beats founders Dr. Dre and Jimmy Iovine. (Getty)

In January 2014, Beats launched its first online music streaming service. In the service, Beats are partnered exclusively with AT&T. In streaming, Beats is competing directly with Apple’s own iTunes radio. In April, it was reported that Apple were considering an overhaul of iTunes to counter declining sales. iTunes radio is apparently nowhere near competing with Pandora.


5. 300 People Work at Beats

Beats Dr. Dre Apple

(Getty)

Beats by Dr. Dre was founded by Dre and producer Jimmy Iovine in 2008. The company employs 300 people. In 2011, the company was subject to a takeover by Apple competitor HTC, according to Bloomberg. After purchasing 50.1 percent of the company, HTC gradually began sell shares back to Beats. The deal was complete by the end of 2013.


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