Apple is planning to buy Beats Electronics for $3.2 billion, according to a report from the Financial Times. Announced as soon as by next week, the deal will be Apple’s biggest acquisition to this date. The report was further confirmed by The Wall Street Journal, The New York Times and re/code.
Popular headphone maker and music company Beats, founded by rapper Dr. Dre and famed producer Jimmy Iovine in 2008. The company recently forayed into the competitive subscription based music streaming business by launching Beats Music in January this year.
Apple CEO Tim Cook revealed in the latest earnings call that the company had purchased 24 companies in the last 18 months.Beats Music could provide Apple with an improved or alternative version of its own streaming music service, iTunes Radio that was launched last year.
The move clearly suggests that Apple wants to enhance its online music offering and make iTunes even stronger. Also, it looks like Apple wants to tap the music accessories business which is a great potential market as well. The deal will eliminate its new entry competitors thereby making Apple a strong leader in the music business.
Source: Financial Times