With the expected Beats Electronics acquisition by Apple expected to take a week longer than first reported, industry watchers are making their last minute predictions as to why Apple would be interested in the audio and music service company.
The latest notable guess? Walter Isaacson, the man who literally wrote the book on Steve Jobs. Dan Lyons, former Fake Steve Jobs, reporting for Billboard:
“Isaacson thinks the Apple-Beats deal is not about headphones or streaming music but rather is about video. He speculates that Cook wants Iovine to run Apple’s content business and help Apple launch the TV product that analysts have been gossiping about for years. The product has been held up because Apple can’t get all the content owners on board.”
Lyons adds that Isaacson shared with him something which he did not include in the authorized biography of the late Apple co-founder: Jobs was pitched on Apple buying Universal by Jimmy Iovine around 2002 or 2003…
Apple obviously did not buy Universal at the time, but the note is made that much more interesting in light of reports that Apple will announce a deal to buy Beats Electronics, co-founded by Jimmy Iovine, any day now. Our own Jordan Kahn wrote extensively last week about the possibility of Apple becoming the most powerful record label in the world with Jimmy Iovine and his goals for the music industry on board with Apple and its existing infrastructure.
In short, Iovine is dead set on improving the music industry whether it’s through headphones, streaming music, or any other business. Isaacson’s prediction that Iovine will run Apple’s content business is plausible as The Wall Street Journal has reported the acquisition could put Iovine in an executive position at Apple.
Isaacson, of course, is highly regarded when it comes to reading into Apple’s plans considering the exclusive access to Steve Jobs he was granted when tasked with the role of writing Jobs’ official biography. Notably, Jobs told Isaacson that he had cracked the code on what the television experience should be like and described a smooth experience yet to arrive to consumers.
With that being said, it makes sense for the biographer to associate such a large acquisition involving an entertainment industry insider with Apple’s plans for television – especially since that vision has yet to come to fruition – and it’s certainly possible his experience could lend favor to Apple greatly as it continues to negotiate deals with content providers and bring new channels to the Apple TV set top box lineup and whatever it has planned after the set-top box.
In January, the biographer commented on Apple’s lack of innovation compared to Google but later cited Apple’s ability to execute as its strength. That’s to say that Isaacson’s access to Jobs does not necessarily translate to knowledge of future roadmaps and inherently better predictions.
Isaacson’s guess is that the expected $3.2 billion purchase of Beats is about putting Iovine in charge of its content business in an effort to ship the ultimate vision for the Apple TV. For me, that sort of dismisses everything about Beats Electronics as a whole except its co-founder. Is buying Beats the quickest way to buy Jimmy Iovine and deliver the ultimate Apple TV experience, or could Apple have hired Iovine without involving headphones and music subscription services?
At any rate, the general mood at this point is for the acquisition to actually materialize (and here’s to hoping for some guidance from Apple on its reasons) before any more grand guesses about why it may happen continue to come forward.
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I would take this with a giant grain of salt. Isaacson is famous for having no vision or insight, and Dan Lyon is famous for being a hard-core fantasist with delusions of grandeur and no moral compass. Even if Isaacson is correct, the fact that it’s filtered through that lying little jerk Dan Lyons, is reason enough to be sceptical.
Anymore realistic than the iPhone-6-daily-concept stories this site has posted?
Haha!
The Facts
* Apple has previously only ever purchased startups with valuable IP… or the patent portfolios of bankrupt giants.
* Beats will be Apple’s largest ever acquisition… by far.
* Beats has little or no IP that would be of value to Apple… apart from its brand.
* Apple has been bleeding market share… almost exclusively at the youth/budget end of the market.
* Apple’s recent attempt to address this (the iPhone 5c) was a complete flop. Largely because of Apple’s unwillingness to tarnish their reputation with a genuinely budget product. And because, Apple’s loyal customers were only interested in a premium product… the iPhone 5s.
My Speculation
* Apple will adopt a Toyota/Lexus marketing strategy. With Apple being Lexus… and Beats being Toyota.
* An Apple owned Beats will market its own smartphones and tablets – aimed at the youth and budget markets. These devices will use iOS and Apple services… iTunes, App Store and iCloud (the Apple eco-system).
* These devices will have their own distinct (non-Apple) design aesthetic… and will be lower spec (and cost) than the Apple range… but they will be cool… very, very cool. Apple’s know-how and production muscle will ensure that these phones stack up extremely well against the Android opposition.
* Of course Apple could start their own youth brand (and keep the $3.2 billion). However, history is littered with failures of such attempts. Beats has established a very successful youth brand.
* Beats devices will lure (tens of) millions of young customers away from Android devices… and into the Apple fold. When these customers turn 30… and want a grown-up smartphone/tablet… the will be locked into the Apple eco-system… and buy an iPhone 11s.
* It makes sense that Apple’s largest ever acquisition will be used to fight Apple’s biggest ever battle – against Google, Android, Samsung et al.
Interesting!
How do you compare Beats to Toyota? The headphones cost more than most iPods. We’re not talking about a low budget here but a premium price instead, like an Apple product. Beats is like a Lexus.
The iPhone 5c is a flop?
http://www.businessinsider.com/iphone-5c-android-sales-2014-3
Interesting speculation! I think the Isaacson\Lyons 2 cents are more about them staying in the headlines than anything else. But who knows, the Beats acquisition will be very interesting to watch how it plays out.
I meant to reply to Eddie, not Oflife.
I like that vision, anything is possible at this point, no one would’ve ever thought Apple would do such a thing and buy another Big Brand, it’s a first time for any & everything.
iPhone 5C a flop? Do you have any evidence to support that claim? If anything it’s Apple’s most successful mid-range handset ever. It’s sold more than the 4S did when it was the mid-range handset, it was even reported that it sold more than Windows Phone, Blackberry and Android flagship devices in one particular quarter. Hell it even sold more than the Galaxy S4 at one point. Sure Apple may have had more ambitious sales goals for it but to say it’s a flop when it’s outsold previous iPhone mid-range handsets and even the competition would be wrong.
Unfortunately all the doom and gloom and flop talk seems to stem from early rumours expecting Apple to release a cheap handset which was never going to happen.
Interesting, though not especially telling. His knowledge of such a potential move is limited at best and much of this is just a wild guess on his end.
Which is why it’s called speculation. Or as you put it “a wild guess”. No kidding. Isn’t everything a guess unless you are part of the internal happenings? I thought this was a place for comments, thoughts, ideas and discussion about the stories that are posted on this site. Some of these stories are fact. Some are speculation/rumor. No harm in having ideas shared here. Even if someone’s knowledge is “limited at best”.
Never said there was a problem. I enjoy this site. I was just commenting…
And yet somehow it’s a story… I don’t get it…. :-/ (scratching head)
Gets people to click onto their site :)
If Isaacson is right, along with Apple’s rapprochement with Google and Samsung, it signals a huge shift away from a combative negotiating (non-negotiating) position on everything and towards getting on with the huge opportunities that lie beyond. Cut the deals, already.
iTunes Radio has proved that if you take way too long to make the deals with the content owners, you can be left behind by others who are latecomers. This was a major blind spot for Steve Jobs, surprising because iTunes was the first entrant to get licenses with the big five record companies for selling music downloads. Beats kicked Apple’s ass in a market Apple should have owned two years ago. Credit Tim Cook with recognizing this at last, if this is true.
If Iovine can cut deals with video content providers and build out the streaming business as well as music, the acquisition of the strategy plus the service and crappy headphones will pay off. When you’re as late as Apple is to this market, you have to buy your way in. If not Beats, who?
And why again are we paying any attention to an Author who just happened to be picked to write the book Steve Jobs wanted written? Is that all it takes to be a voice in the tech industry? Someone who wrote the bio of the most famous tech genius? All of a sudden he is one to listen to?
Did I miss something?
“Isaacson thinks the Apple-Beats deal is not about headphones or streaming music but rather is about video. He speculates that Cook wants Iovine to run Apple’s content business and help Apple launch the TV product that analysts have been gossiping about for years. The product has been held up because Apple can’t get all the content owners on board.”
And it took $3.2B! to get him? C’mon!
Tim: We don’t want the Beats name or market share, we want YOU Jimmy! But we are willing to buy the whole company, being the largest acquisition in our company history to get you! You are the only guy in the world who can do it Jimmy!
Get real Isaacson!
“Isaacson, of course, is highly regarded when it comes to reading into Apple’s plans considering the exclusive access to Steve Jobs he was granted when tasked with the role of writing Jobs’ official biography. Notably, Jobs told Isaacson that he had cracked the code on what the television experience should be like and described a smooth experience yet to arrive to consumers.”
And why is he “highly regarded”? Did someone tell him Steve is no longer at Apple? How long has it been since the “finally cracked it” quote and yet somehow, we have seen no leaked photos OR new product yet.
I think he’s full of himself and stretching his repeated book quotes and his 15 minutes….
“Isaacson’s guess is that the expected $3.2 billion purchase of Beats is about putting Iovine in charge of its content business in an effort to ship the ultimate vision for the Apple TV. For me, that sort of dismisses everything about Beats Electronics as a whole except its co-founder. Is buying Beats the quickest way to buy Jimmy Iovine and deliver the ultimate Apple TV experience, or could Apple have hired Iovine without involving headphones and music subscription services?”
Exactly….
Move on Walter, write a new book already.
God you know, I was up all night wondering what this guy thought.