Business
Apple looking to acquire Dr. Dre’s Beats headphone company for $3 billion
Cook has shown a willingness to spend more of Apple’s money than Job ever did. Among other things, Cook began paying Apple stockholders a quarterly dividend and has progressively committed more money to buying back the company’s shares.
Apple’s pursuit of Beats Electronics is the latest indication that the company is having trouble generating growth on its own. Apple already sells Beats Electronics gear in its stores, giving the company insights into how much the trendy headphones and other audio equipment appeal to its customers.
The negotiations also are taking place as the music market increasingly tilts toward streaming and away from the downloads that once drove the success of Apple’s digital music store, iTunes.
U.S. revenue from downloads, which iTunes dominates, dropped 1 percent to US$2.8 billion in 2013, while streaming music revenue from the likes of Pandora and Spotify soared 39 percent to US$1.4 billion, according to the Recording Industry Association of America.
While downloads still command 40 percent of the market, streaming revenue now accounts for 20 per cent of total revenue, up from just 3 per cent in 2007.
In 2012, Beats bought streaming music service MOG, which it transformed and relaunched as Beats Music earlier this year.
Copyright 2014 The Associated Press
