Why the Beats would go on for Apple

Madeleine Swain
12 May, 2014
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Last week the news broke that Apple was in the final stages of talks to buy the headphone/audio equipment maker and music streaming service supplier Beats for the princely sum of US$3.2 billion.

The suggestion certainly seems to have brought the commentators out of the woodwork. Everyone has an opinion on the idea it seems and many of those opinions are from incensed self-professed audiophiles mystified as to why Apple would want to align itself with a brand they see as inferior. Why not Sennheiser? Or Bose or Audio Technica, is the lament.

Other observers have noted that, of course, the major difference between Beats and all of those other brands isn’t so much audio quality (a concept that will always include a measure personal taste, anyway); no, it’s that none of them also owns a music streaming service. And it seems likely that this is the technology that has most interested Apple.

The Cupertino company made its first foray into the arena last September, with the launch of iTunes Radio. But reports last month noted that the service has so far failed when it comes to halting the decline of music downloads from iTunes. This is turn has apparently led to Apple considering a radical overhaul of the digital music store.

As Billboard reported on 9 April, “iTunes Radio, which launched… with much fanfare, so far only sees about one to two percent of listeners clicking the buy button, while overall music downloads have been declining upwards of 15 percent, according to several label executives,” adding, “Apple’s desire for a smooth transition is complicated by an urgency that iTunes must move quickly as people move away from downloads, where Apple controls 90 percent of download music sales in the US, towards streaming, where Apple is overshadowed.”

With this in mind, Apple’s intentions regarding Beats certainly make a lot more sense. If the future of popular music is less about acquisition and more about access, expertise and proven success in the field of music streaming services would be of the most use to the company. It would also explain the further rumours that Beats founders, Jimmy Iovine and Dr Dre (the stage name of Andre Young), are likely to be given senior positions at Apple if the deal does go ahead.

AppleInsider writes, “A report [on Thursday] claimed Iovine was in talks to become a ‘special adviser’ to Apple CEO Tim Cook, but did not mention Young’s role in the process. At the time, it was speculated that the music exec would enter Apple under a so-called ‘acqui-hire’ agreement that could feasibly be extended to Young as well.”

 

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