Eddy Cue and Jimmy Iovine talk Beats acquisition at Code Conference
Tim Cook said they would, and they did it. Apple doesn’t have any religious beliefs against massive, multi-billion dollar acquisitions, so when the time felt right, they pitched a price to Beats Electronics, and Jimmy Iovine with Dr. Dre said yes.The result? A widely-scrutinized acquisition that saw Apple engulf the audio/music company to bolster its iTunes offerings and perhaps even give us a new pair of headphones with the upcoming iPhone 6.
The lowdown is explained by Eddy Cue and Jimmy Iovine in a 60-minute video interview at the Code Conference hosted by Re/code’s Walt Mossberg and Kara Swisher.
As Apple was confirming the $3 billion / €2.2 billion acquisition in a formal announcement on its web site, Cue and Iovine were explaining the deal at length on stage. Tim Cook himself had sent a letter to Apple employees outlining the same basic ideas behind the costly purchase of Beats, which mainly centered around the talent, not the headphones.
Apple essentially bought the people, admitting that such know-how doesn’t “grow on trees.” For his part, Beats co-founder Iovine agreed that the only company they wanted to join forces with was Apple. He called Cook’s organization, “the best company in the world.”
So what’s in it for Apple? After all, they’re the ones buying Beats, not the other way around. As Iovine himself points out, Beats Music offers something special: truly curated music. With Apple’s in-app purchase system, the model can find success and give the likes of Pandora a run for their money.
“Who doesn’t want their product made by Apple?” reads a transcript of Iovine’s speech. “We have a lot of dreams for the streaming music service. It is important to everyone. We have to get this right. We have to get this model right. We need to be steroids into this thing, and Apple is the best company in the world.”
With 800 million subscribers, iTunes has no shortage of credit cards on file ready to get a taste of what curated music really means. Cook explains it best in his letter to Apple employees:
“We get a subscription music service that we believe is the first subscription service that really got it right,” Cook said. “They had the insight early on to know how important human curation is. That technology by itself wasn’t enough — that it was the marriage of the two that would really be great, and produce a feeling in people that we want to produce.”
The full Code Conference interview with Cue and Iovine can be found below. Enjoy!