First published on http://finance.yahoo.com/
Apple acquires Beats
Apple announced on May 28 that it has agreed to buy the subscription streaming music service Beats Music and Beats Electronics, which makes headphones, speakers, and audio software, for a valuation of $3 billion. The Beats brand will remain separate from Apple’s. This has been Apple’s largest acquisition until now. Beats was founded by hip-hop artist Dr. Dre and record producer Jimmy Iovine. The deal has yet to be confirmed by Apple. Beats competes with popular streaming services like Pandora (P), Spotify, Deezer, Rhapsody, and Rdio and is expected to add to Apple’s existing music products portfolio such as iPods and the top music retailer iTunes store. Apple also launched its iTunes Radio service last year. Reports noted that digital music sales are declining because of streaming services and Apple is seeking exclusive content from music labels. According to Nielsen SoundScan, U.S. digital sales declined 13.3% in 1Q14.
For more on Beats acquisition, please read Why Apple acquired Beats for $3 billion—its largest acquisition on the Market Realist website.