Iovine Cook Dr Dre Cue Beats

The European Commission has today approved Apple’s acquisition of Beats Electronics and Beats Music. The commission said that the buyout passes merger regulations. The commission concluded that Apple and Beats’ combined marketshare in both the streaming music and headphones markets is low, so an acquisition did not materially affect competition.

In headphones, the EU says that Apple/Beats exists in a global market with numerous other brands, including Bose, Sennheiser and Sony. For streaming music, companies like Spotify and Deezer offered a similar safety buffer. As the EU commission cares only for European operations, the fact that iTunes Radio and Beats Music do not currently operate in European countries also helped the deal go through smoothly.

The board also ruled that the deal would not incentivize Apple to shut out third party music services from the iOS App Store, as a result of the Beats buyout. This is because Apple was already deeply entrenched in the music market before the purchase, so it makes little sense for Apple’s attitude toward music competitors to change after a ‘small’ purchase. More information about the case can be found in the EU competition case directory. Apple is yet to receive approval for Beats in the United States, although Apple has said that it expects the deal to close sometime in the third quarter.

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12 Responses to “European Commission approves Apple’s acquisition of Beats”

  1. The EU decides two American companies can merge. How cute. Two words for you EU regulators that you keep hearing from some of your member States, “National Sovereignty”. Got it?

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    • I don’t understand it at all… What does the EU have to do with this acquisition?

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      • ajsanchezmartin says:

        The European Commision always decides on buy operations of American companies that are operating in EU territory and the buy may affect local companies

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      • Last time I checked iPhones and Beats headphones can be bought in european countries.. you know, with, like, money…

        /facepalm

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    • EU doesn’t decide if American companies can merge or not, but can ban their products from EU market, and I guess Apple wouldn’t like that.

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    • Ok, so everyone got it wrong. Fail. The EU Commission has approval over the merge of these two companies, because they both use Ireland as a tax haven. Ireland has an incredibly low tax rate. This encourages companies to claim Ireland as the headquarters for global operations, despite the fact that CEOs still spend the majority of their working time in the US. These aren’t the only companies that take advantage of the tax savings. Google, Amazon, Dell and many other large tech companies use Ireland as a way of increasing revenues by billions of dollars. The senate held a hearing with Apple over it’s practices, claiming that Apple avoided paying 44 Billion in US taxes in one year.

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      • Err.. no.. completely nonsense. It’s true that big companies use ireland as a tax haven, but that has nothing to do with the eu commission agreeing to a merger.

        Back to school, boy.

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    • lexxkoto says:

      The US belongs to England. Always has, always will.

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  2. Seriously? Apple and Beats do business in europe, so the commission has to approve the merger, like every other country in the world too. Unless Apple/Beats don’t want to risk an import ban.

    Maybe your education stopped too soon, buddy.

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