Recently Apple announces that they would be acquiring Beats Electronics, maker of the ever so popular Beats headphones that all youngsters revere so much for an agreed $3.2 billion (RM10.56 billion, yes billion with a ‘B’). The acquiring of Beats Electronics would mean Apple would have the rights to the design, manufacturing and the sales of Beats Electronics’ most prominent item – Beats headphones. Besides the headphone Apple would have the rights to their Beats Music too, an online music streaming like Spotify, Pandora, and the mix but focuses on customers who already has Beats headphones. With the acquisition also Apple would gain two new senior partners who could significantly contribute to Apple in the music industry. Both co-founders, Dr. Dre and Jimmy Iovine, are veterans in the music industry. With their expertise and experience Apple hopes to regain some market share in the music industry through their iTunes service which is according to them ‘stagnant’.
One other issue that Apple looks to solve by the acquisition is the penetration into the Android market. There were rumours that Apple was developing iTunes for Android which for many of us Android users would be redundant as there are plenty of options out there including Beats Music. Beats Music could be the iTunes for Android in Apple’s eyes, or at least they hope that it would be. In this situation the acquisition may be what Apple needs to penetrate into the territory of Android.