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"The deal includes both Beats Music and Beats Electronics."
Image tweeted by Dr. Dre after the announcement
Following months of speculations, Apple has formally announced its acquisition of Beats for a price of $3 billion, which includes $2.6 billion in cash and $400 million in stock. Despite earlier rumours that Apple was only interested in Beats Music, the popular subscription-based music streaming service, the company also added Beats Electronics to the mix, which includes the brand’s popular lineup of headphones, speakers and audio software. The deal is expected to close in late-September, following regulatory approval.
Beats co-founders Jimmy Iovine and Dr. Dre (Andre Young) will join the management at Apple, although their exact roles haven’t been defined yet.
Commenting on the deal, Apple’s CEO Tim Cook said, “Music is such an important part of all of our lives and holds a special place within our hearts at Apple. That’s why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world.”
Apple’s iTunes has lost out on market share to services like Spotify and Pandora, and Beats Music should give it an easy entry into the world of subscription-based music streaming.
Beats Music has already updated its iOS app, announcing a $20 discount on its annual subscription and extending the trial period to two weeks. The service will continue to be available on Android and Windows Phone after the deal is complete.