How Apple’s acquisition of Beats launched a sneak attack on the future of sound

“When Apple announced it was acquiring Beats in 2014, lots of critics scoffed… Why was the most valuable, competent and profitable tech company on earth prepared to spend $3 billion—by far the most it had ever paid in an acquisition—to get Beats?” Daniel Eran Dilger writes for AppleInsider.

“Apple only acquired Beats three years ago. It’s already directly generated two solid new hits: Apple Music and AirPods, as well as a portfolio of revamped Beats products and the retooled audio performance across all of Apple’s Mac and iOS devices,” Dilger writes. “The significant lead in audio performance that HP, HTC and Amazon were once touting at the beginning of this decade has evaporated away.”

“That major shift in audio savvy not only demonstrates Apple’s incredible competence in selecting, engaging and implementing strategic acquisitions, but also suggests that the company has the ability to do similar things in the future to surpass rivals who have a temporary edge in specific technologies,” Dilger writes. “Apple has been consistently catching up and surpassing rivals, largely driven by well-considered strategic acquisitions.”

Read more in the full article here.

MacDailyNews Take: Apple overpaid for Beats, but if that’s what it took to get Iovine & Dre on board and ramp up Apple Music, not to mention the ancillary revenue from Beats’ middling-to-worse / now-improving in sound quality headphone business, what does Apple care? $3 billion is pocket change to the Cupertino colossus.

54 Comments

  1. “Remember that Apple only acquired Beats three years ago. It’s already directly generated two solid new hits: Apple Music and AirPods, as well as a portfolio of revamped Beats products and the retooled audio performance across all of Apple’s Mac and iOS devices. The significant lead in audio performance that HP, HTC and Amazon were once touting at the beginning of this decade has evaporated away.”

    The deal that already paid for itself with sales of Beats audio products aka. Headphones…. duh…

    1. Clearly you don’t understand about buyer perception and sales which as they are King perhaps you should. Probably not difficult to check out both however no matter what we think about fidelity. After all B&O have been fooling the market for years and on a financially massive scale too.

        1. Your ears hear nothing. You hear with your brain, the single most variable organ in our bodies. What you hear is not what anyone else hears, so what you know is that your brain doesn’t like beats, but that has nothing to do with anyone else’s brain. Since our brains mingle all sensory input, perhaps yours doesn’t care about style, while others do.

  2. Daniel Eran Dilger is normally one of the few insightful observers. Does he explain why AirPods could not have been developed by Apple without Beats? What does the $3 billion spent on a company known mostly for bad audio and an association with foul mouthed rappers bragging about raping women?

    I think Apple could have developed the industry’s best audio products without wasting $3 billion. And I detest the association of Apple with the culturally and morally depraved world of rap music.

    1. I tend to agree with you but it will have saved them a lot of time and effort and as I mention above perception and sales are different to actual audio quality. Apple has improved on that so benefits are both ways and Beats will due to its brand help them in myriad ways as markets develop. In recent times Apple have hardly suggested their ability to develop new products is a taken. Finally what ever one thinks of Beats quality it has a market, youth appeal and brand impact in the precise areas Apple needs to tune into and greater experience in appealing to those audiences. So we probably should not be too snooty about their ability to contribute.

    1. Destroyed sound how? The analysis of HomePod I’ve read says the things it is doing with sound are normally only found in speakers worth two thousand bucks or more. Audio engineers are amazed by HomePod, seems like they might know what they’re talking about.

        1. The sound portion of HomePod has already been demonstrated and the technical details are available. That’s enough for engineers to weigh in, and they’re impressed. Is it possible HomePod sucks as a speaker? I suppose, but given what engineers (who know better then you or I) have said I don’t think that is a likely outcome.

            1. Assuming HomePod is as good as reviewers and engineers have said, it will be useful to me, as long as the sound is as good as people who have already tested HomePods are saying it is. From what I’ve read two HomePods working together could be better than my current audio set up, with much less hassle (and additional features), and cheaper at $700 for two HomePods. I will listen to the speaker myself and make a final judgment, but I have no reason to believe everyone who has tested HomePods thus far is lying. You seem to be assuming that everyone is lying about how good the sound is and you are dismissing the analysis of very qualified engineers when it comes to the audio tech inside the HomePod. The consensus is that it is very impressive for the price point.

            2. There’s no blind belief involved here. The HomePod has been reviewed by people more qualified to talk about sound and audio tech than you or I, and the consensus is that they’re impressed. Reserving final judgment for myself has nothing to do with blindly believing anything. What is wrong with you?

            3. I didn’t miss anything. You were talking about “how sensational” the HomePod might be with regard to price and performance, and the answer based on your current audio experience with your B&W A7 may be that the HomePod is as good or better for the same price point. Given that you can buy two HomePods for the same price my theory would be it is a better value than what you bought.

  3. ” … but also suggests that the company has the ability to do similar things in the future to surpass rivals who have a temporary edge in specific technologies,”

    I seem to feel that the word “Netflix” is bobbing about somewhere in that thought process.

  4. If one can prove that AirPods wouldn’t have happened without Beats, then I agree. AirPods alone were with a $3 billion investment. I swear it’s the least talked about revolutionary product Apple has ever produced. That Cupertino is able to sell them for only $160 is extraordinary.

    But I don’t see how you can make that case, unfortunately. AirPods were probably in the pipeline before the acquisition. At best perhaps someone or some technology from Beats helped get the design team over a big hump.

  5. And yet, Windows, with there audio enhancement software built in, still sounds better than the simple, default, not all that, audio of the Mac. Software always wins over hardware.

    Devin Prater Assistive Technology instructor in training, JAWS Sertified.

    >

  6. Does anyone really think Apple wanted the Beats Headphones division? They wanted Beats Music streaming service. This was probably an all or nothing deal. If anything, Apple has only improved the beats headphones by introducing higher quality and the W1 chip. Apple is not know for buying companies to increase their revenue. They buy talent that can improve their products and I don’t think Beats Headphones did that, Beats Music yes but not headphones.

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