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Pricey headphones: Apple reportedly looking to buy Dr Dre's Beats Electronics for $3.2bn


Apple is said to be in talks to buy Beats Electronics, the headphone maker and music streaming service founded by hip-hop star Dr Dre and music producer Jimmy Iovine, for more than $3 billion.

If a deal to buy the company went through it would be Apple’s biggest ever acquisition, dwarfing the $404 million (roughly $600 million today) that the company paid for NeXT in 1996.

Since the death of co-founder Steve Jobs, Apple has been under pressure to come up with its next big idea, though some analysts have been confused by reports of the potential acquisition.

“This is really puzzling,” Forrester Research analyst James McQuivey told Reuters. “You buy companies today to get technologies that no one else has… or customers that no one has.”

“They must have something hidden… under the hood.”

Other analysts have speculated that Apple might be contemplating merging Beats Electronics' music streaming service with it's own, iRadio.

Beats Music currently has a few hundred thousand subscribers - less than rivals including Spotify and Pandora - but has championed the concept of the 'curated playlist' with celebrities and DJs offering users their 'personal selection' of tunes.

The strategy might not sound like much but it could help the streaming service stand out in an already crowded market, as well as enhancing the 'premium' feel of both brands.

Apple chief executive Tim Cook met Beats chief executive Iovine last year to discuss a potential partnership, Reuters reported in March, with Cook telling journalists at a previous quarterly earnings that the company was "on the prowl".

"We are not in a race to spend the most or acquire the most. We're in a race to make the best products that enrich people's lives," said Cook.