Beats acquisition Stories August 1, 2014

Apple formally takes ownership of 13 percent of Beats from Vivendi/Universal Music Group

Apple’s $3B acquisition of Beats was never going to be completed overnight, and it’s only today that Apple actually completed its purchase of the 13 percent of the company that was owned by Vivendi/Universal Music Group, the world’s largest record label.

In a one-sentence press release, Vivendi announced that the sale of its shares had been completed for a total of $404M. It was expected that Apple would have acquired all of the Beats shares by the end of September, but based on the formal welcome message, it appears this may complete the sale.

While Wall Street may have been unimpressed by the acquisition, Tim Cook described it as an exciting new chapter in Apple’s history, and Eddy Cue said that the deal would help music grow again.

Apple is in the process of determining which Beats staff will join Apple, and which positions will be eliminated.

Beats acquisition Stories May 29, 2014

We’re less than 24 hours removed from Apple announcing its acquisition of Beats and the Dr. Dre and Jimmy Iovine headphone empire has already announced a new product.

The Beats Solo2 headphones are a follow-up to the massively popular Solo model that sold nearly four units every minute last year. It seems that Beats has addressed one of the biggest criticisms of previous models. Some said they were too bass-heavy which resulted in what some critics called “poorly-mixed hip-hop sound”.

The Solo2 headphone has a more dynamic, wider range of sound, with a clarity that will bring you closer to what the artist intended, whether you’re into hip-hop, heavy metal, jazz, electronic, or country.

These new cans sport a nearly identical design, while some tweaks have been made to increase overall comfort.

…the frame of the headphone has been curved like never before, giving the Solo2 a custom-fit feeling. The earcups have been ergonomically angled to complete this natural fit, with pivots for optimal comfort and sound delivery. Finally, the earcups’ premium material helps dissipate heat and minimize sound leakage.

Apple obviously had no impact on this product release since the deal isn’t expected to be finalized until the company’s fiscal Q4 of this year, but it’s interesting to see Beats trying to shake of some its old stigmas to appeal to audiophiles as well as music listeners who put bass and fashion first.

The Solo2 headphones are now available for preorder for $199.95 in a range of colors from Best Buy, beatsbydre.com, and are expected to hit other authorized retailers late this week… expand full story

Wall Street

Judging by a roundup in The Wall Street Journal, analysts and investors appear not to share the enthusiasm for Beats acquisition express by Tim Cook and Eddy Cue. While Cook said he was “excited […] about this new chapter in our history” and Cue believed that “combining the two companies will help [music] grow again,” Wall Street is more skeptical.

“To see this kind of money spent for a company that gets most of its revenue from hardware business is not what we want to see,” said Dan Niles, chief investment officer of hedge fund AlphaOne Capital Partners …

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Beats acquisition Stories May 28, 2014

Declining iTunes sales highlighted by Morgan Stanley’s Katy Huberty and reported by Fortune appear to underline the need for Apple to move beyond sales of music downloads and into the subscription music business. iTunes sales are down 24 percent year-on-year.

While the slack is being picked up by app sales – a trend previously noted by Asymco’s Horace Dediu – that falling blue line reflects the wider shift in consumer behaviour from purchasing downloads to subscribing to streaming services noted last year by Billboard magazine …  expand full story

Beats acquisition Stories May 13, 2014

Beats Music had only 111k subscribers in March, claims music blog

 

If a leaked royalties report posted by a musician’s blog is genuine, Beats Music subscribers certainly played no part in Apple’s presumed decision to acquire the company. The report appears to indicate that the service paid first quarter royalties to musicians based on total subscriber numbers of just 110,992.

As Business Insider notes, there are a couple of complications that make it hard to determine the actual number of paid subscribers. First, the majority of subscriptions are family packages, where a single payment of $14.99 a month allows up to five users to access the service. The total number of users will thus be higher than the raw subscription figures.

Against this, however, a promotion by AT&T offering free 90-day subscriptions mean that many of those appearing in the subscriber numbers may have paid nothing.

Either way, the numbers are irrelevant to Apple. With the headphone business bringing in $1B a year, Apple appears to have bought itself a well-respected streaming music technology, unrivalled music industry expertise and contacts, and a highly successful marketing team, for a bargain price.

Following the presumed acquisition of Beats, Apple plans to up its music game with support for high-resolution audio files in a revamped Music app in iOS 8, and to offer a higher-quality version of its In-Ear Headphones, reports Japanese blog Macotakara

The source of the high-res audio rumor appears somewhat circumstantial, linked to a Warner Music post about the forthcoming release of a ‘Super Deluxe’ version of three remastered early Led Zeppelin albums in 96kHz/24-bit form – a resolution the current iOS Music app cannot play. It is, however, consistent with a similar earlier rumor regarding iTunes support for higher-quality audio …  expand full story

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