Apple buys Beats for $3 billion →

Brian Chen at The New York Times:

Apple, the company that turned digital music into a mainstream phenomenon, said on Wednesday that it was buying Beats Electronics, the rising music brand, for $3 billion, in a move that will help it play catch-up with rivals that offer subscription-based music services.

Apple and Beats executives on Wednesday said that the companies would work together to give consumers worldwide more options to listen to music. The Beats brand will remain separate from Apple’s, and Apple will offer both Beats’s streaming music service and premium headphones.

Don’t miss this quote from Tim Cook:

Could Eddy’s team have built a subscription service? Of course. We could’ve built those 27 other things ourselves, too. You don’t build everything yourself. It’s not one thing that excites us here. It’s the people. It’s the service.

Apple’s press release discusses Beats’ headphone business as well as the streaming service, so I expect both to stay around for the forseeable future.

Apple expects to close the deal later this year.