Apple Impressed by Beats' Ability to Attract Paid Subscribers, Likely to Keep Brand Separate

beatsMusic industry veteran Jimmy Iovine is believed to be the primary target in Apple's rumored acquisition of Beats Electronics, but the company also is eyeing Beats' streaming music service and the Beats branded headphone business, reports Bloomberg. Apple likely will assume leadership of the company, but keep the Beats brand independent.

Beats co-founder Iovine previously pitched the idea of a streaming music service to both Steve Jobs and Tim Cook, but neither party showed interest until the streaming music service launched earlier this year.

Apple became interested in doing a deal with Beats after executives were impressed by Beats Music, an online music streaming service unveiled earlier this year, which was rapidly converting users into paying subscribers, said a person with knowledge of the talks, who asked not to be identified because the discussions are private.

Beats Music could fill a gap in Apple's music portfolio, which now offers digital downloads via iTunes and iTunes Radio, a channel-based music streaming service akin to Pandora. Though still a leader in the music download arena, iTunes is losing ground to full-library streaming music services like Spotify, which is poised to overtake iTunes as Europe's largest online digital music service.

Besides the music service, Apple also will obtain a high-margin headphone business co-founded by rap musician Dr. Dre, Iovine, and early partner Monster cable. As part of the acquisition, Beats will likely remain an independent brand with Apple providing design improvements for future Beats products.

Both Iovine and Dre may take on senior roles at Apple following Apple's acquisition, remaining at Beats' Los Angeles headquarters and traveling to Cupertino when necessary. Iovine is expected to leave his role as chairman of Interscope Geffen A&M records and use his music industry experience to help Apple secure future deals with music labels.

Popular Stories

iPhone 17 Pro 3 4ths Perspective Aluminum Camera Module 1

New iPhone 17 Pro Details: Brighter Display, Best Battery Life, and More

Wednesday September 3, 2025 5:33 am PDT by
Apple's iPhone 17 Pro and iPhone 17 Pro Max models will feature a number of significant display, thermal, and battery improvements, according to new late-stage rumors. According to the Weibo leaker known as "Instant Digital," the iPhone 17 Pro models will feature displays with higher brightness, making it more suitable for use in direct sunlight for prolonged periods. The iPhone 16 Pro and...
iPhone 17 Pro in Hand Feature Lowgo

iPhone 17 Pro's Biggest Design Mystery is Finally Solved

Friday September 5, 2025 9:33 am PDT by
Apple is set to unveil the iPhone 17 series in just four days from now, and the biggest design mystery surrounding the Pro models has finally been solved. In a report outlining his expectations for Apple's event next week, Bloomberg's Mark Gurman said the iPhone 17 Pro models will have "a new cutout area on the bottom two-thirds of the phone that doubles as the wireless charging area."...
Apple Watch Ultra 2 Complications

Apple Watch Ultra 3 Coming Next Week: Eight Reasons to Upgrade

Thursday September 4, 2025 7:38 am PDT by
We're only days away from Apple's "Awe dropping" fall event scheduled to take place on Tuesday, September 9 – and along with the new iPhone 17 series, we're going to get a new version of the Apple Watch Ultra for the first time since 2023. By the time the Ultra 3 is unveiled, it will have been two years since the previous model arrived. The intervening period has left plenty of room for...
iPhone 16 Battery Life Feature

iOS 26's New Battery Life Mode is Limited to These iPhone Models

Wednesday September 3, 2025 1:19 pm PDT by
iOS 26 introduces an Adaptive Power Mode on the iPhone, alongside the existing Low Power Mode. Apple says Adaptive Power Mode can make "performance adjustments" when necessary to extend an iPhone's battery life, including slightly lowering the display brightness, allowing some activities to "take longer," and automatically turning on Low Power Mode when the iPhone's remaining battery life...
apple event september 2025 interactive logo

Everything Apple Plans to Debut Next Week, According to Bloomberg

Friday September 5, 2025 4:57 am PDT by
Four days out from Apple's "Awe dropping" fall event on Tuesday, September 9, Bloomberg's Mark Gurman has summarized his expectations for what the company will reveal next week. Aside from a couple of new details and the inclusion of some more recent leaks from other sources, much of the following is a recap of Gurman's reports over the last several months: iPhone 17 Large...
iPhone 17 Pro Iridescent Feature 2

iPhone 17 and iPhone 17 Pro Prices Estimated Ahead of Apple Event Next Week

Tuesday September 2, 2025 1:50 pm PDT by
Just one week before Apple is expected to unveil the iPhone 17 series, an analyst has shared new price estimates for the devices. Here are J.P. Morgan analyst Samik Chatterjee's price estimates for the iPhone 17 series in the United States, according to 9to5Mac: Model Starting Price Model Starting Price Change iPhone 16 $799 iPhone 17 ...

Top Rated Comments

losthorse Avatar
148 months ago
-- removed by user --
Score: 41 Votes (Like | Disagree)
cmChimera Avatar
148 months ago
"We can't innovate anymore... let's just buy the first thing that celebrities endorse."

-Tim

You're sooo funny and original.
Score: 20 Votes (Like | Disagree)
chriscrk Avatar
148 months ago
If people think this acquisition is stupid just because they don't like the headphone quality, they fail to realise the bigger picture, and they are real bozos.
Score: 17 Votes (Like | Disagree)
WinstonRumfoord Avatar
148 months ago
So...

Firefox/John Q Public effectively ousted it's CEO for donating $500 to a cause against gay marriage.

I wonder what Apple, a historically progressive company will do about Dr. Dre making millions glorifying homophobia and misogyny?

"Long as my mother****ing pockets was fat
I didn't give a **** where the bitch was at
But she was hangin' with a white bitch doin' the **** she do
Suckin' on his dick just to get a buck or two"

Just food for thought...
Score: 14 Votes (Like | Disagree)
trife Avatar
148 months ago
I'm happy for all you Apple doomsday prophets--you can relax now.

All you undercover (and also overt) bigots can still kick rocks though.

And to all the aforementioned groups, see you at the iPhone 6 launch.
Score: 10 Votes (Like | Disagree)
bighype Avatar
148 months ago
"We can't innovate anymore... let's just buy the first thing that celebrities endorse."

-Tim
Google buys advanced AI and robotics, Facebook buys AI and communications… and Apple buys fashion accessories for urban kids.

Apple Maps still suck, Siri is still a gimmick and yet Apple spend billions on BS instead of on improving these core products.

Tim Cook's an idiot. He's the next Ballmer.
Score: 7 Votes (Like | Disagree)