Beats officially joins Apple as $3-billion deal closes
Apple Inc. has finalized its $3-billion deal for Beats, adding a lineup of headphones, speakers and streaming music service to its core products of iPhones, iPads and Macs.
The Cupertino, Calif., company confirmed the completion with an announcement on its website:
“Today we are excited to officially welcome Beats Music and Beats Electronics to the Apple family. Music has always held a special place in our hearts, and we’re thrilled to join forces with a group of people who love it as much as we do.”
The page directs visitors to the Beats by Dre site, which explains that all online orders will now go through the Apple Store. It also has a video ad touting how wonderful Beats audio sounds on a Hewlett-Packard laptop.
The Beats deal is the largest in Apple’s history, though it’s relatively conservative by Silicon Valley standards. Beats has a revenue stream and profits, though not enough to make a major dent in Apple’s overall business.
Part of the attraction was the Beats founders, music mogul Jimmy Iovine and rapper Dr. Dre. With the music industry continuing to experience upheaval, Apple appears to be hoping these insiders can help it maintain and expand its relationships with talent and music labels.
Overall, the market for music downloads, which Apple helped pioneer more than a decade ago with the iTunes store, has been shrinking. In its most recent quarter, though, Apple said the fastest growing part of its business was the App and iTunes stores, along with services.
Apple will continue to sell the Beats Music streaming app on iOS, Windows and Android platforms. That’s a small but interesting departure for Apple, which traditionally has made its own apps available only on its own gadgets.
Apple received approval from U.S. and European regulators this week to close the deal. As those approvals came, word spread that Apple was planning to cut as many as 200 jobs at Beats.
In a statement given to tech blog Re/Code, Apple confirmed the cuts and sought to portray them in a somewhat softer light.
“We’re excited to have the Beats team join Apple, and we have extended job offers to every Beats employee,” Apple spokesperson Tom Neumayr explained to Re/Code. “Because of some overlap in our operations, some offers are for a limited period and we’ll work hard during this time to find as many of these Beats employees as we can another permanent job within Apple.”
Beats Music, which is based in San Francisco, still lists eight job openings on its LinkedIn page, including a gig for a Windows Phone developer.
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