Eddy Cue and Jimmy Iovine go in-depth on Apple's Beats acquisition and future plans
Speaking at the Code Conference on Wednesday, Apple SVP of Internet Software and Services Eddy Cue and Beats cofounder Jimmy Iovine offered a peek behind the curtain of Apple's $3 billion deal covering everything from subscription music services to future hardware.
Apple SVP Eddy Cue (left) and Beats co-founder Jimmy Iovine at the inaugural Code Conference. | Source: Re/code
In a wide-ranging discussion with Re/code's Walt Mossberg and Kara Swisher, Cue and Iovine detailed the reasoning behind Apple's purchase of Beats, the company's largest acquisition ever. Topics moved from Hollywood's rocky relationship with Silicon Valley, why the television experience is so poor and what role the audio company will play in Apple's future, among others.
After plowing through boilerplate PR talk -- buying Beats was "a no brainer" -- Cue opened up a bit by saying the deal to buy Beats, or at least the talent behind it, has been in the works for a decade. Together, the two companies can accelerate ongoing projects and products that are still under wraps.
As discussed earlier in the day, Apple seems to have been more interested in Beats Music, Beats' subscription streaming service, than headphone and speaker hardware. Iovine revealed that Beats Music gained 250,000 subscribers in three months of operation. The number would have been higher if Beats had rolled in in-app purchasing from the start, he said.
Cue also let loose some statistics of his own, saying Apple sold its 35 billionth songs through iTunes last week and currently has around 40 million users listening to iTunes Radio around the world. Apple plans to keep Beats Music a separate brand, but has been thinking about subscription-based streaming for a long time, he said.
For those wondering about the fate of Beats Music on other platforms like Android and Windows Phone, Apple plans to keep those assets alive for the foreseeable future. Since Apple normally closes off access to other operating system after buying out an app or service, the unusual move to keep Beats Music alive may be a bid to appease regulatory agencies that have yet to sign off on Apple's acquisition.
On the hardware side, Cue was tight-lipped about future products, but did compliment Beats on its headphone business. Iovine was less positive when talking about earbuds that come with phones, saying smartphone makers include them to make sure the sound works. The music mogul went on to say it's not the responsibility of companies like Apple to create these traditionally aftermarket devices.
Cue defended the EarPods, which come free with every iPhone purchase, saying they offer industry-leading out-of-the-box sound, but admitted that making "incredible sound" costs more money.
Interestingly, when Mossberg asked about Apple's foray into speakers with the now-dead iPod HiFi, Cue said the device wasn't a good idea at the time -- but it is now.
Apple SVP Eddy Cue (left) and Beats co-founder Jimmy Iovine at the inaugural Code Conference. | Source: Re/code
In a wide-ranging discussion with Re/code's Walt Mossberg and Kara Swisher, Cue and Iovine detailed the reasoning behind Apple's purchase of Beats, the company's largest acquisition ever. Topics moved from Hollywood's rocky relationship with Silicon Valley, why the television experience is so poor and what role the audio company will play in Apple's future, among others.
After plowing through boilerplate PR talk -- buying Beats was "a no brainer" -- Cue opened up a bit by saying the deal to buy Beats, or at least the talent behind it, has been in the works for a decade. Together, the two companies can accelerate ongoing projects and products that are still under wraps.
As discussed earlier in the day, Apple seems to have been more interested in Beats Music, Beats' subscription streaming service, than headphone and speaker hardware. Iovine revealed that Beats Music gained 250,000 subscribers in three months of operation. The number would have been higher if Beats had rolled in in-app purchasing from the start, he said.
Cue also let loose some statistics of his own, saying Apple sold its 35 billionth songs through iTunes last week and currently has around 40 million users listening to iTunes Radio around the world. Apple plans to keep Beats Music a separate brand, but has been thinking about subscription-based streaming for a long time, he said.
For those wondering about the fate of Beats Music on other platforms like Android and Windows Phone, Apple plans to keep those assets alive for the foreseeable future. Since Apple normally closes off access to other operating system after buying out an app or service, the unusual move to keep Beats Music alive may be a bid to appease regulatory agencies that have yet to sign off on Apple's acquisition.
On the hardware side, Cue was tight-lipped about future products, but did compliment Beats on its headphone business. Iovine was less positive when talking about earbuds that come with phones, saying smartphone makers include them to make sure the sound works. The music mogul went on to say it's not the responsibility of companies like Apple to create these traditionally aftermarket devices.
Cue defended the EarPods, which come free with every iPhone purchase, saying they offer industry-leading out-of-the-box sound, but admitted that making "incredible sound" costs more money.
Interestingly, when Mossberg asked about Apple's foray into speakers with the now-dead iPod HiFi, Cue said the device wasn't a good idea at the time -- but it is now.
Comments
"I have been working with Tim since 1997. We started the online store together. Cook is extremely thorough, he has tremendous vision. He cares tremendously about building great products. Looking at the executive team, the reason we are successful is because of our focus. We are not smart enough to do 100 great things. We want to do a few incredible things, and that hasn’t changed. We’re going to keep going down that path… Later this year, we’ve got the best product pipeline that I’ve seen in my 25 years at Apple” - Eddy Cue
Holy shit. Apple executives don't say these kinds of things lightly.
I agree, that was a low blow and lacking a bit of class. Not to mention that all things considered, Apples headphones sound pretty damn good for the price. Infinitely better than the old ones.
Anyway don't lose sleep over this beats deal. Im not even into music, but I don't care as I know that Apple has many other things in the works and this is just a small piece of its business.
That's in line with Cook and Jobs saying they have great products in the pipeline. That abridged backstory by Cue is atypical for that conclusion but your bolded sentence seems like the same Apple corporate speak we hear every year.
I have no doubt this will be the best products because even if there are no radical changes to any current product lines or any new product categories added even a bump spec makes it the best product. For example, that recent 100MHz CPU bump on the new MBA is better than every other MBA that has ever existed. It's bested the only one by 3% in CPU performance but it still bested it.
I agree, that was a low blow and lacking a bit of class. Not to mention that all things considered, Apples headphones sound pretty damn good for the price. Infinitely better than the old ones.
Anyway don't lose sleep over this beats deal. Im not even into music, but I don't care as I know that Apple has many other things in the works and this is just a small piece of its business.
I'll respectfully disagree about Apple's headphones. I find them horrible in all honesty. They never stay in my ears for more than 5 seconds before falling out and the sound quality I find to be just above mediocre.
I agree, that was a low blow and lacking a bit of class. Not to mention that all things considered, Apples headphones sound pretty damn good for the price. Infinitely better than the old ones.
It's amusing to me, because he could have just as easily been talking about his own brand of headphones. You can buy better headphones for far less money. The iPod was in my opinion the last thing Apple made that was really poorly made. I liked the selection methods and itunes. The battery failures and and cheap earbuds are the reason I classify them that way. Apple did however stock a range of headphones in their retail stores and online. I suspect this was more for the streaming service, but I really do hate seeing them buy into a brand known for overpriced crap.
I must have different music taste to Iovine then. Beats headphones sounds like crap ( at its price range )
And Apple's earpod sounds great for something given out for free.
Do I expect B&W sound quality from Apple EarPod? Hell no, But out of all the one given out with a smartphone. Apple's one were clearly the best.
The sound quality, design and construction are on par with Apple's EarPods? Have you ever even tried their Urbeats SE in-ear phones? Of course not, so I'm curious where your irrational hatred comes from.
The sound quality, design and construction are on par with Apple's EarPods? Have you ever even tried their Urbeats SE in-ear phones? Of course not, so I'm curious where your irrational hatred comes from.
I don't care much for earbuds in general, as I always have trouble with them. The amazon reviews on the Urbeats SE model contain a lot of failure complaints. I haven't seen that in reviews or personal experience with Apple's earbuds. I just didn't care for the sound quality of the old ones, and they were really uncomfortable to use.
Because they came out and stated that?
The Apple headphone diss is pretty ironic and also pretty low class, but then again, I can't say that I'm surprised. Apple's headphones are free with certain devices, nobody is expecting Apple's earbuds to sound as good as other headphones that costs hundreds of dollars. Audiophiles who listen to music through their Apple devices are already using other high quality headphones that they own.
Plenty of people think that Beat's headphones are crap, so coming from them, that statement is even more hilarious.
We don't know what they'll end up doing. Announcing the acquisition doesn't mean that Beats Music will not be put into iTunes or the Music app in some way. If their "humanized" algorithm is really that good I'd love for it to replace Genius Playlist so it can make better playlists of the music I own.
I'm quite shocked to hear him saying that. You just don't do that. I wonder what relationship Cook and him have. This guy still has to work for Apple and I can't imagine having much positive outcome of this if that guy is so dismissive about what his parent company and employer does.
Cue certainly did raise the bar tonight. But **** Iovine for ripping Apple's headphones on stage. He said Apple only makes headphones to test that the audio on the phone is working right. A bit rich coming from someone who makes headphones that a lot of people feel are overpriced crap. I hope if he and Dre start to interfere in product design that Ive tells them to **** off.
I just checked out Beats Music just to see what the big deal is all about.
It's God awful. If that's what Cook wanted to spend $3 Billion, then he's going to have to spend another $3 Billion cleaning it up. It's HORRIBLE.
What a complete waste of money.
I'm now waiting for WWDC to see what the response is when they bring these idiots on stage. If there is a negative reaction from the crowd, it's going to be a PR nightmare.