Apple/Beats deal now rumored to have lower price tag

Apple/Beats deal now rumored to have lower price tag

Apple's deal to purchase Beats is reportedly being dialed back a bit, though at $3 billion it's still quite the acquisition. The deal, which has yet to be formally announced, was first leaked three weeks ago, with a price tag of $3.2 billion. Apparently the negotiations weren't near complete, and the massive leaks around the acquisition, not to mention the profane boasting of Beats co-founder Dr. Dre and a report that Beats Music had as few as 110,000 subscribers did not help things much.

That said, $3 billion is still nothing to sneeze about. The Beats Music service might not be gaining traction, but it's still a solid service, and even with it weighing on Beats' books the company still recorded sales of $1.3 billion in 2013 (a generally small drop in the bucket for Apple, though).

Dr. Dre's share of Beats is reported to be around 25%, which could see him netting "just" $750 million off a $3 billion sale. Once the IRS gets their hands on that sum, he'll be well short of that "first billionaire in hip-hop" status he'd claimed. Sorry bro.

Do you see $3 billion as a fair price for Beats?

Source: New York Post

Derek Kessler

Managing Editor of Mobile Nations, Army musician, armchair pundit, and professional ranter.

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Reader comments

Apple/Beats deal now rumored to have lower price tag

13 Comments

Still not understanding why Apple would pay so much for something that could be "out of fashion" (including Dr. Dre) within months...

Feels kind of like they are investing in "Hammer Pants". MC Hammer sure was good at selling those to all ages.... until it was no longer considered cool.

Just doesn't fit Apple.

Still think it's a stunt.. one that Beats is milking for everything they can.. Beats has gotten a lot of press on this.. Now everyone and their son goes out just to see their new streaming service...

Rumor starts, he 'posts' video.. probably just as a laugh.. then pulls it to heighten suspicions.. then just sits back and lets media run with it..

Yup.. I'll believe it when I see the Apple announcement.. past that.. it's just a stunt to me.

Queue the "Apple shouldn't buy Beats, because it's owned by a rapper" comments. People never fail at showing their ignorance.

Some people here have a problem with Apple buying Beats, simply because it's owned by Dr. Dre. Their comments, not mine.

I was thinking the same thing. Plus the IRS comment kinda missed the mark. The whole story is really insignificant as is the price to Apple's balance sheet.

My money says this deal wont happen at all. A bunch of hype surrounding a service that no one listens to and headphones that are sub standard at best.