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Apple Acquires Beats: News Recap

Jimmy Iovine, Tim Cook, Dr. Dre, and Eddy Cue.

Jimmy Iovine, Tim Cook, Dr. Dre, and Eddy Cue.

Following speculation surfaced over the past few weeks, Apple today confirmed the acquisition of Beats Music, a music streaming service that launched in January, and headphone-maker Beats Electronics, co-founded by music industry executive Jimmy Iovine and rapper Dr. Dre. Beats represents Apple’s biggest acquisition to date: Apple is spending a total of $3 billion to acquire Beats, which will continue to be a separate brand.

In a press release, CEO Tim Cook stressed the importance of music as a cultural tenet of Apple:

“Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” said Tim Cook, Apple’s CEO. “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.”

In the same press release, Apple’s Eddy Cue remarked Beats’ focus on music products and noted how the Beats Music subscription service will be added to Apple’s music lineup, which consists of iTunes Radio, iTunes Match, and the iTunes Store. The Beats Music app for iOS was updated earlier today with a lower-priced annual subscription and an extended free trial; Apple has confirmed that they will keep developing Beats Music apps for other platforms, which at the moment include Android and Windows Phone.

The Beats Music team will be joining Apple and report to Senior Vice President of Internet Software and Services Eddy Cue.

Beats Music launched earlier this year featuring a selection of human-curated playlists handpicked by an editorial team of music experts, such as former Pitchfork editor-in-chief Scott Plagenhoef and top radio programmer Julie Pilat. In their press release, Apple included a mention of Beats Music’s unique offerings:

Beats Music is a subscription streaming music service that focuses on providing a personalized music experience for each user through a unique blend of digital innovation and musical passion. Programmed by a trusted team of well-respected music experts with over 300 years of experience across all genres, Beats Music delivers the right music for any situation, any time, and any preference, personalized to your tastes. The result is an artist-friendly digital music service that does more than simply offer access to music, but one that establishes an emotional connection to it as well.

The sentiment was echoed by Tim Cook, who wrote about how Beats Music, of all modern music streaming services, was the first one to “get it right” in a company memo published by 9to5Mac:

Beats Music was built with deep respect for both artists and fans. We think it’s the first subscription service to really get it right. Both Apple and Beats believe that a great music service requires a strong editorial and curation team, and we will continue to expand what we do in those areas. The addition of Beats will make our incredible iTunes lineup even better, extending the emotional connection our customers have with music.

In Apple’s current plans, the company will keep the Beats brand separate and sell its popular premium headphones (widely regarded as modern fashion accessories) and music streaming service. In Cook’s words, as reported by The New York Times, the Beats team is “really unique”; he added that the deal – which should close by the end of the fiscal year – was a “no-brainer”.

Beats’ deal with Apple will sever a partnership between the audio company and HP, which integrated Beats branding and software in some of their products. As reported by CNET:

A company spokesman said in an email that HP is allowed to continue developing products with new Beats Audio technologies through 2014. But it’s allowed to continue selling devices with the Beats Audio logo and technology through 2015. HP says it’s planning an aggressive lineup of new products that includes the Beats branding through 2014. These products will have the full Beats Audio experience, the company says. Currently, Beats technology is included in about 15 percent to 20 percent of devices sold by HP.

Another partnership that will terminate after Apple’s acquisition will be the one with Ammunition, the design firm behind popular Beats Electronics products such as Beats Pill and Beats Studio. In a blog post, Ammunition founder Robert Brunner writes:

Over the next few months, the design for Beats will transition away from Ammunition. It’s tough to step down as Chief Designer for a brand I take so much pride in, but it certainly makes it easier knowing we are handing the reigns over to one of the world’s most successful design teams.

Design and engineering of Beats hardware products (headphones and speakers) will fall under the leadership of Phil Schiller, Apple’s Senior Vice President Worldwide Marketing. According to The Wall Street Journal, Beats co-founders Jimmy Iovine and Dr. Dre won’t get any special title at Apple, simply going by “Jimmy and Dre”.

Apple’s Eddy Cue and Beats’ Jimmy Iovine will appear on stage at the Code Conference later today, set for 8 PM PT.

Beats Music’s First 100 Days→

Yinka Adegoke, writing for Billboard:

Two of music’s most successful brand marketers, Jimmy Iovine and Dr. Dre, are in the hot seat as label sources grouse that the first 100 days of the duo’s subscription streaming service, Beats Music, has been a disappointment and soon will face competition on the mobile platform when Sprint begins bundling Spotify with its “Framily” plans.

According to Beats Music CEO Ian Rogers, the company is doing fine and the problem has been converting iOS users to paid subscriptions.

I still believe that the human curation Beats is doing for music recommendations offers great value, but the service needs to be available internationally and on more platforms. Spotify is available in several countries outside the United States, has desktop and mobile apps, and, more importantly, it has mindshare after years of existence. For some people, Spotify is synonym of “legal music streaming” (when I was using Rdio, I would always introduce it to my friends as “an app like Spotify”).

If Beats Music doesn’t want to offer a free plan, they should aim at people willing to pay for streaming services through new software, international rollouts, and exclusives. Last week, they released an update to their iPhone app with better social integrations and App Store subscriptions. iTunes will undoubtedly make it easier to subscribe to Beats Music, and I’m hoping that the company will find a way to grow its userbase quickly without compromising on the original vision.

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Beats Music Launches API For Third-Party Developers

Beats Music

Beats Music

As reported by CNET, Beats Music, the music steaming service that launched two months ago as Beats Electronics’ sister company, has introduced an API today. Available here, the Beats Music API will allow third-party developers to integrate their apps with Beats Music to access a catalogue of over 20 million songs and, more importantly, other features such as search, recommendations, playlists, and curated content.

If you’re willing to pay $100 a year for music, which in my experience for all the world’s music is a tremendous bargain, you should have access to music anywhere you might want it, in your car, house, anywhere,“ Beats Music Chief Executive Ian C. Rogers told CNET in an interview.

A new entry in the music streaming space, Beats Music launched to a substantial marketing campaign that saw a Super Bowl ad and various celebrity endorsements; unlike the major players in the field (Spotify and Rdio), Beats Music comes with a single paid tier that allows for unlimited, high-quality streaming at 320 kbps for $9.99 per month. Beats Music doesn’t have ads, and, this point, it has an iPhone app, a somewhat limited web app, and it lacks native apps for the desktop and tablets.

What differentiates Beats Music are the curation efforts that CEO Ian Rogers – a longtime music industry personality – wants to put at the center of the Beats Music experience. Over the course of the past year, the company has built an editorial team of music experts and critics who curate songs and albums in playlists and collections that are then automatically suggested to users. On top of curation, Beats Music allows listeners to receive songs based on their current mood and activity through a feature called “The Sentence”.

All these features are exposed in the API that Beats Music made public today. As the company writes:

Beats Music believes in being as open as possible, because we think the best ideas come from you. This is why we’ve decided to open up nearly all of our REST resources, which we use ourselves, to everyone.

The Beats Music API comes with fairly common functionalities such as artist and track lookup, audio playback (with two bitrate settings), search, metadata retrieval, and library management, but it also enables developers to access more specific aspects of Beats such as individual options for The Sentence, artist popularity, personal recommendations for “Just For You” items, featured Highlights and Editor Picks, new releases, and playlist subscriptions.

Beats Music’ API appears to offer a solution to, effectively, access all the functionalities of the official Beats Music app. Documentation (including terms of service) can be viewed here.

This week, Apple showed Beats Music among the list of initial partners for their CarPlay initiative. With Beats Music entering the crowded space of music streaming and radio services, an API may help the company gain traction among third-party developers quickly, enabling them to feature the service’s library and editorial aspects on a variety of devices and platforms. Just yesterday, music steaming service Spotify reported the acquisition of The Echo Nest, a music data company used by hundreds of online music services, including Rdio and MOG, which was acquired by Beats in 2012.

Why Beats Music Matters

Beats Music

Beats Music

How do you treat music less like data and more like art, and make a business out of it? That’s the question Beats Music, a spin-off of Beats Electronics risen from the acquisition of MOG, wants to answer with their new music streaming and recommendation service.

I first got wind of Beats Music in December, and, when I heard the news last week that Beats Music was launching to the public, I thought I wouldn’t care. As MacStories readers and The Prompt listeners know, I’ve been happily using Rdio for the past three years: Rdio gives me all the music I want, it lets me check out New Releases and subscribe to playlists created by other users, and it’s got a Stations feature that automatically recommends music I may like based on my history and listening data collected about me. There are many reasons why I prefer Rdio over Spotify, which I’ve shared on several occasions in the past. Rdio works: you type stuff in, you get music back. If you don’t want to search, the service gives music to you with recommendations that go from “good” to “great”.

As coverage of Beats Music started coming in and cynics quickly derided the service for being part of a company that makes headphones audiophiles don’t like, I got curious. Beats Music’s CEO Ian Rogers, for instance, has a quite amazing story of being a pioneer of Internet-based music delivery and marketing, working (and touring) alognside Beastie Boys at a very young age, eventually going to work for Nullsoft, Yahoo Music, TopSpin Media, and now Beats Music.

The creation of Beats Music itself was spearheaded by Jimmy Iovine (historic music producer and co-founder of Beats Electronics with Dr. Dre), who ended up hiring Nine Inch Nails’ Trent Reznor as Chief Creative Officer of the new service because Reznor himself had been looking for a new take on music streaming services.

On a product level, Beats Music offers no free tier as it is a paid-only service that delivers 320kbps MP3 streams and promises to pay artists higher royalties thanks to the lack of cheaper, ad-supported streams. When I went to check out Beats Music’s website, I found an honest, well-written FAQ that explained the company’s vision and motivations for launching a paid service just after Spotify and Rdio extended their free tiers to tablets and desktops.

I could go on with a list of factors that contributed to piquing my interest in Beats Music. Such as the way Rogers worded his explanation of the service’s paid-only model, or how he explained their strategy to The Verge and then offered a simple screenshot as proof that ads in music may not always be the best option. Or how Reznor – for context, the guy who left his label to try “alternative” marketing campaigns that included leaving free copies of NIN songs in USB flash drives in bathroom stalls – said that “to brag about being agnostic and just providing access to music seems to me, as a culture person, as a fail” when asked about Spotify’s search and algorithm-based music platform.

As a music lover and iOS geek, it seemed silly to dismiss Beats Music just because of others’ opinions about headphones, and I’m glad I didn’t. I can’t stop using Beats Music. Read more