Apple has agreed to acquire music streaming service Beats Music and sister headphones, speakers and audio software firm Beats Electronics for US$3 billion, with founders Dr Dre and Jimmy Iovine to join Apple.
Apple said the companies had agreed a US$2.6 billion purchase price for the acquisition of the two Beats companies, with a further US$400 million to vest over time.
The deal remains subject to regulatory approvals, but Apple said it expects the completion to occur by the fourth quarter.
“Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” said Tim Cook, Apple’s chief executive officer (CEO).
“That’s why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world.”
“Music is such an important part of Apple’s DNA and always will be,” said Eddy Cue, Apple’s senior vice president of Internet Software and Services.
“The addition of Beats will make our music lineup even better, from free streaming with iTunes Radio to a world-class subscription service in Beats, and of course buying music from the iTunes Store as customers have loved to do for years.”
Founded in 2008 by Dr Dre and Iovine, the Beats streaming service is intended to provide a personalised approach to music by providing “the right music for any situation, any time, and any preference, personalized to your tastes”, with the founders saying it does “more than simply offer access to music”, but also “establishes an emotional connection to it”.
The founders said the market leading premium music accessory line Beats Electronics is meant to bring the “energy, emotion and excitement of playback in the recording studio” to listeners, while also having built a significant fashion following with popular music artists having designed their own Beats-branded headphones and speakers.
“I’ve always known in my heart that Beats belonged with Apple,” said Jimmy Iovine.
“The idea when we started the company was inspired by Apple’s unmatched ability to marry culture and technology. Apple’s deep commitment to music fans, artists, songwriters and the music industry is something special.”
