Apple to Acquire Beats Audio

Buconero,

Apple isn't perfect and this acquisition might prove to be a mistake. OTOH, they've created an incredibly valuable company, taken down a horde of more established competitors, created a slate of products that dominate their sector, and grown into one of the world's most valuable brands. I'm not sure that I'd conclude that they're anybody's fool. If they successfully lever the Beats streaming platform the way I suspect they'll try to, this might well prove to be a very shrewd move.

AFAIK, none of the independent streamers are making money. It's a tough gig as a stand-alone business, but for those with more at stake, well....

Spotify is a strategic play by a consortium of major labels and they are the only target in that business right now. It's pretty clear that that way lies the future and Apple evidently believes that Beats is the best road to get there. Until they fail, I'll reserve judgement.

I agree that the long term hidden asset is the content to populate Apple's platform of devices. My nephews all got Beat earbuds for Christmas last year. I found that they were WAY too loud and bass heavy. They really couldn't compete with my old Sony earbuds I use for exercise, yet they cost about $100. My sister didn't really care for my argument about sound quality and seemed to be more concerned about brand recognition from her kids. Therein lies Apple's interest. Some types of rock and roll are best enjoyed being played loud, but my first reaction (I guess I am getting old) to the Beats product was that the company is going to create a generation of deaf kids.

many of you (as well as the business pundits) have opined that apple's real target was the streaming business, but i'm not sure--beats audio has supposedly done a good job of converting trial listeners to paid subscribers, but they're still a speck on the map (200k subscribers, many off promo plans from att vs. 3m for spotify)+ it would seem like they're cannibalizing their own itunes radio platform (i.e. how many paid itunes subscribers would also subscribe to beats or vice versa). beats' hardware does present some interesting synergy--it gives apple the major player not just in the headphone realm, but also in the whatever-you-call the portable pill/speaker area + potential in car audio, etc. the main thing it's buying, however, would seem to be brand cachet, which is always risky--not much cool stuff(nike and apple itself excluded) stays cool for a long time. still, apple is smart people, so i wouldn't bet against 'em.

Another way of looking at it is Apple is acquiring Jimmie Iovine.

If you live in a yuppie town, say Madison, Boulder, Burlington,VT etc , Apple rules because to buy a PC would call your yuppyhood into question. No joke.