Apple officially announced on Wednesday that it has agreed to acquire high-end headphone and speaker maker Beats Electronics, along with Beats Music, the acclaimed streaming music service. As a part of the deal, Beats co-founders Jimmy Iovine and Dr. Dre will join Apple.
Apple will pay a total of $3 billion for the companies, consisting of a purchase price of approximately $2.6 billion and approximately $400 million that will vest over time.
Iovine and Dre will join Apple as full-time employees, and both will report to iTunes head Eddy Cue.
“Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” said Tim Cook, Apple’s CEO. “That’s why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world.”
“I’ve always known in my heart that Beats belonged with Apple,” said Jimmy Iovine. “The idea when we started the company was inspired by Apple’s unmatched ability to marry culture and technology. Apple’s deep commitment to music fans, artists, songwriters and the music industry is something special.”
Apple expects the transaction to close in fiscal Q4. The Beats Music iOS app has been updated to include an extended 14-day trial period and a price drop of its annual subscription to $100 from $120.
(A tip of the hat to @TheGlennja)