Apple May Buy Beats Audio For $3.2 Bn., But Apparently It Won’t Be For The Hardware
Beats Audio has always had a slightly elevated position in the world of headphones and other related accessories. The company may soon be acquired by Apple Inc., but signs show the acquisition isn’t solely because of the advertised awesomeness of the hardware.
Beats Audio competes with the likes of Koss, Sennheiser, Harman Kardon and so on. Though it has managed to do well for itself, there are much bigger and dedicated companies who have greatly developed the technology behind in–ear acoustics or aural hardware. Still, the company has shot from its current position as one of the many to priority number 1 amid fans of headphones, owing to the near certain rumor that Apple may soon acquire Beats Audio for a cool sum of $3.2 Billion, reports The Verge.
It is interesting to note that Apple does sell Beats headphones in every Apple Store in the world, so it already has exact idea about the sales performance and revenue potential of the company. Apple would surely get itself a significant boost after owning the entire company. This way, instead of just earning commission on every sale, Apple could make a sizable profit off each device. Keeping the entire profit within its coffers would add a nice cushion to Apple’s bottom line, reports Mashable.
But a little research will reveal it’s not about the hardware. Apple has been trying hard to consolidate music streaming under its cloud for quite some time. Ever since iTunes has been out, Apple hasn’t looked back and knew right away that more money could be easily made by simply selling music-related content that didn’t require any component purchases or assembly plants. Apple’s huge servers and data warehouses easily house billions of songs which are repeatedly purchased for quite affordable rates (99 Cents per song).
Apple is clearly focused on neatly sidestepping the middleman and becoming a recording industry giant itself, a fact that hasn’t bode well for major production and recording houses like Sony, BMG, Universal, EMI and the rest of the labels.
Beats Audio has an envious app and associated music streaming service. Initially nicknamed ‘Project Daisy’, the platform officially and unimaginatively called the Beats Music App has been gaining respectful reviews. Owing to extensive experience in audio and sounds, the service has been infused quite intuitive features that are able to closely observe patrons’ listening habits and tune the app accordingly, much better than the competition. The app even has an interesting feature called ‘Play The Sentence’
Along with reliable hardware that is respected by audiophiles, Apple will also be able to lay its paws on copyrighted content that Beats Audio has licensed. If that’s not all, Apple will also get veteran Beats CEO Jimmy Iovine as a ‘Special Adviser’ if the $3.2 Billion deal goes through.
[Images via Bing]
