If this goes through at $3.2 billion, it would be Apple's priciest acquisition ever
If the stars align just right, the next iPhone model may sport a Beats by Dr. Dre logo on the back. According to various reports, Apple is engaged in talks to acquire Beats Electronics for $3.2 billion, which would be the largest acquisition in Apple's nearly 40 year history. However, that's less than half of what Microsoft paid to acquire Nokia ($7.1 billion) and is well short of the $19 billion Facebook forked over for WhatsApp.
Multi-billion dollar buyouts are suddenly vogue it seems, and this would would give Apple a recognizable brand that also includes the new Beats Music streaming service, The New York Times reports. One of the unique selling points of Beats Music compared to other streaming music services is the inclusion of a $14.99/month family plan that covers up to 5 accounts across 10 devices.
No deal is yet in place, though it appears talks are in the advanced stages. Assuming the negotiations don't run into a brick wall, a sale could be announced as early as next week.
This would be an interesting move on Apple's part for a number a reasons, not the least of which is it represents a departure from Steve Jobs' preference to make smaller deals. As current chief Tim Cook pointed out in Apple's most recent earnings call, Apple's made 24 acquisitions in the last 18 months.
"We are expanding Apple's products and services into new categories, and we are not going to underinvest in this business," Cook said.
Apple can certainly afford to make an acquisition like this. The company is sitting on a mountain of cash piled $159 billion high, so plucking $3.2 billion would hardly register a blip. What's more interesting than the purchase price is exactly what Apple would do with the Beats brand and how it would affect the company's approach to streaming music.