At yesterday’s Code/Conference, Apple made their acquisition of Beats Electronics official, with the deal closing sometime later this year. It made for an entertaining afternoon with interviews of CEO Tim Cook, SVP Eddy Cue who heads up Internet Software and Services for Apple and Beats co-founder Jimmy Iovine. Cook took the stage first, joined later by Iovine who will be a full-time employee with Dre. Iovine later joined Eddy Cue. The trio offered some interesting insight regarding the purchase, Apple’s product pipeline and the current state of TV.
Eddy Cue Says Apple Has Best Product Lineup In 25 Years Coming
If you’ve grown weary of all things Beats, Eddy Cue was the latest executive to tease consumers with the promise of exciting new products. Cue, who has been with Apple for 25 years, says the product pipeline is the best he has seen during his time with the company. “Later this year, we’ve got the best product pipeline I’ve seen at Apple, my 25 years at Apple. The interesting thing is that Iovine hasn’t seen everything yet. That comes today, according to Iovine who joked, “When I go somewhere, they put tarps over everything. I’m not kidding, it’s amazing.” Some of those new products might be center stage next week at Apple’s WWDC keynote, taking place on June 2nd at 10:00am PST. Others, including the iPhone 6 will likely come later this year, along with a product refresh to the iPad line. Probably the most intriguing new product category for Apple is wearables and the rumored iWatch. It’s natural to say the product pipeline is strong, but quite another thing to say it’s the best in 25 years. I hear 2007 was pretty good.
Beats Music Apps Will Remain On Android and Windows Phone
Apple now has an app in the Google Play Store for Android and Windows Phone. When the deal was first rumored, some thought it won’t be long before those would be removed. To date, Apple has had little, okay zero interest in offering their apps on other platforms. The strategy is one that is the polar opposite of Google who at times have released updates to their iOS apps previous to updating apps for Android. Confirmed yesterday, both Android and Windows Phone apps for Beats Music will remain.
This move isn’t very surprising when you look back at recent rumors that Apple had been considering either a streaming service or an Android version of the iTune Store. Buying Beats gives them an instant-in on the two other major platforms. iTunes downloads are lagging and streaming is on the rise. Now Apple has its very own streaming music service.
Eddy Cue: Today’s TV Experience Sucks
The TV experience sucks, says Eddy Cue. Apple TV is no longer just a hobby, but now a real product, one that is responsible for a billion plus in yearly revenue. There have been a stready stream of new channels, but the product itself hasn’t changed much in the past few years and a refresh is due. It’s been rumored to support gaming, Apple’s alleged move into smart homes and we’re still waiting to see what Jobs meant when he said they had ‘cracked the code.’ It’s a great little streaming machine, but was never meant revolutionize TV. Cue didn’t offer any details on how Apple might change the status quo. Clearly, Cue has no love for TV in its current format “All we have today is glorified VCRs.”
Tim Cook Explains Why Apple Made Beats Deal
Why did Apple buy Beats? There have been weeks of conjecture, even on this blog as to why Apple would purchase Beats. Is it the music streaming service, the headphones, the talent? Cook goes on about how music in Apple’s DNA, but also provides reasoning for the move.
“We get a subscription music service that we believe is the first subscription service that really got it right. 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. They’ve also built an incredible premium headphone business that’s been tuned by experts and critical ears. We’re fans of that. It’s a reasonable-size business that’s fast-growing.”
Cook calls the pairing not about what the two are doing today, but rather what Apple and Beats “together can produce for the future.”
Beats Currently Has 250,000 Subscribers
The Beats Music service went on line at the end of January. In four short months, they’ve secured 250,000 paying subscribers. Unique promotions through AT&T, offering longer trials and family pricing, have contributed. To put that in perspective, Spotify has roughly 10 million subscribers. They have 40 million active users, who don’t mind ads. With the marketing muscle, iTunes and iOS install base, Apple has plenty of opportunities to hep drive this business. Does Beats become a stock app in iOS 8?
This should do nothing but pique your interest, no only in what Apple cooks up with Beats, but for the best product pipeline in 25 years. Not to mention, Apple will live stream the WWDC keynote. Should make for an entertaining second-half of 2014.