Dr. Dre, Beats Music and Apple – what it all means for the music industry

23/06/2014

“The first billionaire in hip-hop, right here from the m*ther f*cking West Coast, believe it.” - Dr. Dre

Kelsey Curtis Broadcast Coordinator Amplifi @ Carat Apple Beats Music
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Apple released a press statement on May 28 this year, confirming rumours that they had acquired Dr. Dre’s Beats Music, and Beats Electronics. 
 
Already making a reported $1 billion a year from Beats headphones sales alone, Apple purchased the company for $3.2 billion; it is Apple’s largest acquisition to date. 
 
Kelsey Curtis, broadcast coordinator for Amplifi @ Carat, tells us what this means for the industry. 
 
The Apple empire was largely built in 2001 when the iPods revolutionized the music industry, an industry that has changed vastly since then. Music streaming has been driving down album and song sales, an area of music iTunes previously dominated. Usually at the forefront of trends, it’s surprising that it is only now Apple is joining the streaming industry. 
 
Beats Music also arrived late to the music streaming game, but quickly became a strong competitor with companies such as Spotify and Pandora. 
 
Beats has been widely applauded in the music industry as a very simple way of recommending new music and building playlists based on moods and context, making it extremely user friendly. 
 
What made Beats Music different from its already established competition? 
 
It entered the market as a subscription-only service, disregarding ad-sponsored free service options given out by its competitors. What’s also interesting is that Beats playlists aren’t just based on algorithms like most streaming playlists, but each has some form of human touch. Monetising streaming allows a sustainable service beneficial to artists and users. 
 
But why would consumers switch to Beats when they already have accounts on Spotify and other streaming platforms? Surely we can expect to see iPhones, iPads, and Macbooks with Beats integrated technology in the future, which is exactly why consumers will switch; Apple consumers love Apple. 
 
So - what does this mean for the industry? 
 
According to Apple’s Senior Vice President of Software and Services, Eddy Cue, it means: “Better opportunities for artists, better products for costumers.”  
 
The Apple Worldwide Developers Conference (WWDC), which took place early June, revealed nothing about Apple’s future with Beats. Beats is currently under contract with Hewlett Packard until 2015, with Beats integrated in 15-20% of their product. 
 
According to Cnet.com, “HP (is) planning an aggressive lineup of new products that includes the Beats branding through 2014,” and the company plans on continuing sales throughout 2015.
 
Perhaps with the contract's completion, we can expect to see more announcements in regards to Apple’s plans for the future integration of Beats. 
 
What’s clear is that Apple are moving quickly in the world of music; we can look forward to the imminent UK release of iTunes Radio, a separate streaming entity to Beats already released in America and Australia in 2013 that allows iTunes users to freely stream music, but lacks the sophistication of Beats streaming.
 
Between iTunes Radio and Beats streaming, Apple has gone from having very little presence to becoming a strong stakeholder in the streaming world. 

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Kelsey Curtis Broadcast Coordinator Amplifi @ Carat Apple Beats Music
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