Apple has been granted approvial from the European Union to acquire Beats by Dr. Dre. Beats is a company started by famous rapper and producer Dr. Dre and music businessman Jimmy Iovine.
The EU's European Commission concluded the two companies sell widely varying electronic gear. That means the EU doesn't believe the companies are not too closely competitive.
Apple may not be interested in the business simply for its line of headphones alone, as a recent Tech Times article notes. Apple may be trying to leverage star power and align its brand with the image, music and fashion appeal of the Beats founders.
They could be using the deal as a way to boost the popularity of iTune, which faces competition from a multitude of startups and streaming services, reports indicate. Apple also started its own streaming service as well as an unlimited "iTunes Pass", a subscription service for iTunes.
Another point the EU's European Commission brought up in its conclusion was that even though the two companies are involved in the digital music industry, Beats did not have a European presence whatsoever, according to another report. If Beats were active there, other music services such as Spotify still woudn't be put out of business by the move, the commission reasoned.
The plans for this deal were announced in May, according to reports. Apple plans to buy the company popularized by Dr. Dre for about $3 billion. Beats has its own streaming service, which interests Apple as well.
The EU also noted that headphone makers who compete with Beats By Dr. Dre would not suffer greatly either. Those manufacturers include Bose, Sennheiser and Sony. Bose has taken a hard line against Beats, and is suing the company on the grounds that they used Bose patents for noise cancellation.
The United States is expected to follow suit with Europe and approve the deal. Apple wants to wrap up the deal by the end of the year. Interscope Geffen A&M, the record label where Iovine was a chairman, owns 14 percent of Beats. Iovene left his post to become an advisor to Tim Cook, CEO of Apple. Iovene's legendeary music career spans decades and he has worked with Bruce Springsteen and other major superstars in the music industry, an industry where Apple has made a lot of money and laid ground in digital sales. Apple will further seek his expert knowledge of the industry.
