Sunday, June 1, 2014
Apple Buys Beats, What is the real Reason?
Beats is not about headphones or a cool service with licensing deals. Beats is all about one-to-one connection of a brand and subscription service that feeds a person's soul. Apple's acquisition of Beats Electronics is more about the acquisition of a kindred spirit than a new line of business. Sure, the executives from both companies walk entirely differently, but their cores are similar.
I get the sense that a good many Apple enthusiasts are confused by its acquisition of Beats Electronics. Sure, many are nodding their heads, saying that Beats is good for Apple and makes total sense. The headphones are selling well. With 250,000 paying subscribers, the Beats Music service is taking off fast, and it can only be elevated by Apple's global brand and infrastructure.
However, there's an undercurrent of concern, too -- a bit of head-scratching and scrambling to make sense of what this really means for Apple's future. After all, couldn't Apple have built everything that Beats offers, all by itself? (On the surface, yes.)
Does Apple really need to buy "cool" these days? (No.) More worrisome, is Apple becoming one of those big companies that starts buying other companies just to keep the parent conglomerate growing and expanding in order to confuse Wall Street and make lackluster executives feel like they're actually doing something important? (I sure hope not.)
So why Beats? Why now? What the heck is going on here? Is Apple going to start buying companies in order to attract new management talent, like Jimmy Iovine and Dr. Dre? After all, it's hard to make a traditional "hire" of an industry-leading professional with deep industry business connections. A simple hire seems like a step down, especially to pros who are running their own companies. A big acquisition, though, makes landing an Iovine or Dre possible.
Despite making sense on paper, the whole Beats acquisition still seems so anti-Apple that it's just damn unsettling.