The potential acquisition of Beats Electronics by Apple was all the talk last week. The potential $3.2 billion buy-out was huge news, but there was unfortunately no official or new information coming from either party since the original news surfaced. However, a new report has surfaced today, which claims that a large part behind the acquisition of Beats was not for technology, but instead to “acqui-hire” both Jimmy Iovine and Dr. Dre.
The idea behind bringing on Iovine and Dr. Dre is to help with Apple’s streaming music service. According to TechCrunch, Apple wants to increase its marketshare in streaming music because the company recognizes iTunes sales are decreasing, but record companies still depend heavily on iTunes sales. With the addition of Iovine and Dr. Dre on the Apple team, the company hopes to ease its transition away from download sales, and towards the streaming services which have proved much more popular recently with the likes of Spotify and Beats Music. Since Iovine and Dr. Dre know the industry much better than most Apple iTunes employees (since Iovine and Dr. Dre both work in the industry itself), their expertise would be considered incredibly helpful in aiding both Apple and record labels in the transition over the next few years from downloads to streaming.
While the deal is not yet finalized, a source has claimed that there is “70 percent certainty” that the acquisition will still occur, which still proves promising. While there have been disagreements on both sides, which have reportedly led to many near-fatal moments for the deal, things are rumored to be looking better for the acquisition and the future for both Apple and Beats.
While the music industry is worried about the future of music, this deal hopes to ease tensions and make the transition to an all-streaming world much easier for the industry. Do you think bringing on Iovine and Dr. Dre to Apple will benefit the company? Leave your thoughts and comments in the comments section below!