What Does Apple’s Acquisition of Beats Mean for the Future?

Beats and Apple

Yesterday, Apple made waves in the tech and music industry by announcing the upcoming acquisition of Beats Electronics and Beats Music, two subsidiaries of the same company whose focus is on music-related software and hardware. The unprecedented $3 billion purchase has many scratching their heads as to why Apple wanted this partnership so bad. It already has a streaming music service, and the company isn’t exactly known for spending a lot of effort on accessories. So, what made Beats so special and what will this merger mean for Apple fans?

There are two obvious benefits of Apple’s investment in Beats, subscription-based streaming music and headphones. The iPad maker could use some help with both. The Verge reports that Beats Music will continue as-is, at least for a while, “and will even continue to offer casual competing services.” So, it is not likely that we will see a merger of the subscription-based streaming music services. Apple’s iTunes Radio will continue to be more of a Pandora-style smorgasbord of content, while Beats Music will offer a more customized listening experience for those willing to pay a monthly fee.

On the other hand, Beats Electronics, the headphones and speaker department will be answering directly to Apple. Shortly after the announcement, CEO Tim Cook held a small press conference where he told the New York Times that Beats co-founders Dr. Dre and Jimmy Iovine will be working with Apple on ideas and concepts for future products. The team will be working on “products you haven’t thought of yet,” and “seeing around the corner to articulate the way to take music to an even higher level than it is now.”

Since 2008, Apple has been slowly drifting away from the music industry. The fame and popularity of its App Store has stifled the company’s growth in the music industry. Only a decade ago, the iTunes store was the go-to spot for online music purchasing, but Apple rested on its laurels and may have forgotten how important music is to the company.

Cook himself said in the official press release regarding the acquisition that “music is such an important part of our lives and holds a special place within our hearts at Apple.” He also told Re/code, “This is all about music, and we’ve always viewed that music was key to society and culture. Music’s always been at the heart of Apple.”

Similar to when Apple acquired NeXT in order to bring former CEO Steve Jobs back on board, the purchase of Beats is more likely about bringing Iovine and Dre into the Apple family. Cook told Re/code, “What Beats brings to Apple are guys with very rare skills. People like this aren’t born every day. They’re very rare. They really get music deeply. So we get an infusion in Apple of some great talent.” Cook even went so far as to call the Beats team “kindred spirits.”

A decade from now, Iovine and Dre may be the new face of Apple and the new product ideas that come along with the partnership could be just what the iPad maker needs to restart that fire of innovation the company is known for. More than just a music subscription service or a headphone maker, Beats is an investment in the future.

“The point is that Jimmy and Dre have built something phenomenal. And they have phenomenal skills,” said Cook. “And we can begin, the instant that this deal is approved, working on the future together. And I think that future is better than either company could create on their own.”

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About Lory: Writer of all things app related, traveler of the space-time continuum, baker of really great cookies. Follow me @appaholik