Say what you like about how Tim Cook’s Apple is different from how Steve Jobs Apple. Nevertheless, Tim Cook’s Apple has sucked all of the oxygen out of the news cycle for a month or more. And, the Beats deal is just Apple’s opening act.
No matter what you think of Apple and its soft-spoken, gentlemanly CEO, he owns the tech news cycle and will for weeks to come.
Yes, Beats, Iovine and Dre will cost Apple $3 billion whence the deal is done sometime before the end of September. However, the investment headphone maker with it $1 billion in annual revenues will likely pay for itself in two or three years, if not faster.
For its part, Beats Music streaming service could prove to be immediately additive to Apple’s still dominant digital music play, iTunes. Before you snort at that, consider that Apple’s proto streaming service iTunes Radio already has 40 million active listeners, perhaps 10 percent of which are also paying customers.
With Apple distribution and marketing, Beats Music could rule.
Yep and Apple gets Iovine and Dre full time as part of the deal. Think what you will of either man, but both are billionaire geniuses.
What does the Beats deal cost Apple? Something less than 2 percent of the company’s available cash, but the payback on this investment could be almost immediate and long lasting.
As Steve Jobs liked to say back in the day, “Boom.”
WWDC 2014 Keynote
While you contemplate that, again, consider Apple’s just getting warmed up. Next week, Tim Cook et al will take the stage at San Francisco’s Moscone Center to deliver the WWDC 2014 keynote address, which is being broadcast to the world live.
What’s coming there? Apple’s next mobile operating system update, iOS 8, which is expected to deliver Healthbook, an integrated health and fitness monitoring, as well as the company’s Smart Home initiative.
On desktop side, Apple will introduce OS X 10.10, the first major rewrite of the Mac user interface in seven years or so. In fact, it’s rumored that the company has redirected software engineering resources to OS X 10.10 in order to get the job done.
Why would Apple “waste” money on the Mac, OS X and the desktop in this post PC era? Simple, Mac unit volume is still growing absolutely as the Windows PC market shrinks — Apple’s taking a bigger and bigger share of a smaller pie.
That said, Apple recently cut the price of its MacBook Air, the world’s best-selling ultrabook, by 10 percent. It’s believed the company is also planning cut the price of its iMac, the world’s best selling all-in-one desktop, by some unknown amount.
As brilliant as the Beats acquisition is — the hype alone could be worth billions. And, Apple is just getting warmed up.
Yep, as Steve would say, “Boom…”
What’s your take?