Apple may buy Dr Dre's Beats for $3.2bn

2014-05-09 09:12
The million dollar headphones by Beats by Dr Dre and  Graff Diamonds. (Noam Galai, AFP)

The million dollar headphones by Beats by Dr Dre and Graff Diamonds. (Noam Galai, AFP)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

San Francisco - Apple is close to paying a record $3.2bn for Beats Electronics, two people with knowledge of the matter said, an expensive foray into music streaming and headphone gear that would mark a departure for the usually cash-conservative iPhone maker.

Both companies are hashing out details and the envisioned deal could still fall through, one person told the media on condition of anonymity because the discussions were private.

A second source familiar with the matter said that Apple was in the market for a subscription-based music service to complement its "iRadio" ad-based offering, launched in 2013 as part of an attempt to jump into a music-streaming arena then split between a handful of start-ups such as Pandora.

Founded by rapper Dr Dre and legendary music producer Jimmy Iovine, Beats Electronics is best known for its "Beats by Dr Dre" line of trendy headphones that vie with the likes of Skullcandy, Sennheiser Electronic and Bose.

This year, it launched a music service that has won plaudits for its slick design and human music curation, versus the computer-algorithms that determine playlists for most of its rivals.

But analysts on Thursday questioned whether Beats, valued at just $1bn during its last funding round in September, was worth that price.

Apple had more than $130bn in cash as of the end of March, but the vast majority of that is parked abroad and investors have called on the company to return more cash in the form of dividends and buybacks.

Apple-watchers have speculated that the company that upended the music industry, and today is the single largest seller of tunes was contemplating a Spotify-like on-demand music service to go with iRadio service and iTunes.

"This is really puzzling", said Forrester analyst James McQuivey, who said there was huge overlap between the two companies' customer base. "You buy companies today to get technologies that no one else or customers that no one has."

"They must have something hidden under the hood", he said.

Apple declined to comment on the report. Beats Electronics did not respond to requests for comment on the news, which was reported first by the Financial Times.
Read more on:    apple  |  dr dre  |  us  |  technology
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
2 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 

This is what South Africans Googled in 2014!

Find out who and what South Africans were most curious about in 2014!

 
 

I love summer.24

This hilarious song is your new holiday anthem
The world's least visited destination is breathtaking!
LOL treadmill fail!
Google’s top searches of 2014

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Kalahari.com - shop online today

2DAYS ONLY – 30% off Appliances

Coffee makers, blenders, fans, juicers and more. T&Cs apply. Shop now!

2 DAYS ONLY – 40% off books

Get 40% off when you buy 2 books. For two days only! T&Cs apply. Buy now!

Up to 50% off on outdoor gear

Save on chairs, blankets, cooler bags, umbrellas and more. Shop now!

Save on Samsung

Cameras, mobile phones, TVs, Tablets and more. While stocks last. Shop now!

Grand Theft Auto 5

Now available on PS4, Xbox One and PC from R649. Buy now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

Any chance to explore the distant shores of things yet to be found will fascinate you. The challenge is dealing with the issues...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.