Apple's Acquisition of Beats Could Be Delayed Because of Valuation, Roles, and More

Last week, reports indicated that Apple's acquisition of Beats would not be finalized until this week. With the week ending and no deal having been announced, a new Billboard report offers insight into what could be holding up the deal.

beatsdreBillboard's sources indicate the deal "is complicated", as it would be Apple's largest acquisition. In addition, the news apparently leaked "too early", with Apple nowhere near ready for news to break despite publications like Re/code and The Financial Times reporting that the deal is close to completion.

A video that was uploaded to YouTube of actor/musician Tyrese alongside Beats co-founder Dr. Dre is another possible reason for the delay, with Dre claiming that he was the first billionaire in hip hop after the deal. The video apparently "freaked Apple out" and had the Cupertino company outraged.

Apparently, the Apple family near imploded with outrage when that video went up on Facebook of an ‘excited’ Dr. Dre with R&B singer/former Coca Cola pin-up Tyrese. In the video they share, in language perhaps unsuitable for a family blog, how Dre will be hip-hop’s first billionaire and other nice things about Compton.

Fourth, Apple allegedly isn't sure whether to give Beats co-founders Jimmy Iovine and Dr. Dre roles as permanent consultants or whether to give them full-time executive roles. Apple is also apparently unsure whether the two of them would fit into the company's corporate climate, despite reports that Iovine and Dre are the "big prizes" of the acquisition.

Finally, another rumored sticking point is Apple's valuation of Beats Music, which has around 200,000 subscribers and has been speculated as one of the main reasons behind the acquisition. Apple is apparently planning to keep Beats Music separate entity from iTunes in order to avoid cannibalization of iTunes music sales.

Apple pundit John Gruber of Daring Fireball offered another scenario, discrediting the Billboard report and speculating that Beats may have leaked to the deal, angering Apple and scuttling the acquisition before it could be completed.

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Top Rated Comments

Dulcimer Avatar
132 months ago
I can only hope that it's delayed indefinitely.
Score: 109 Votes (Like | Disagree)
troop231 Avatar
132 months ago
That is all I have to say :cool:

Score: 97 Votes (Like | Disagree)
Quu Avatar
132 months ago
I didn't think that video Dre made would help the negotiations. It came off very smug and I'm sure Tim Cook didn't like it one bit.
Score: 53 Votes (Like | Disagree)
goobot Avatar
132 months ago
I hope they just don't buy them.
Score: 49 Votes (Like | Disagree)
irfan22 Avatar
132 months ago
I've read so many articles giving reasons why they are buying beats. It still doesn't make any sense to me.

Hopefully Apple's official statement/WWDC will give real insight, once the deal is finalized (but hopefully not).
Score: 44 Votes (Like | Disagree)
Ryth Avatar
132 months ago
Read a fair bit about this potential acquisition but that was the first time I'd seen the Dre video.

If the deal wasn't sealed prior to him doing the YouTube video I think he's just shot him self in the foot with an AK.

Until the check is in the bank it's not your money - I thought he'd be a bit more business savvy than that, obviously not.

Apple does need to 'acquire' Jimmy Iovine. He is where it's at when it comes to taking the pragmatic approach to the way the music industry has been and is heading. Not to mention he has the cred in the industry and the smarts to make the negotiations.

I could see Iovine on the executive team as "iTunes Manager" or something along those lines.

Dre, I can't see being part of the Apple executive/corporate environment.

saggsy

Can't take the hood out of a thug.

I hope Apple nixes the deal and then Dre gets his @$$ handed to him by the BEATS board and management.

Apple should just hire Iovine and just forget the rest of BEATS.
Score: 38 Votes (Like | Disagree)