The rumors were true.
In a press release from Apple, the company confirmed its acquisition of headphone maker and music streaming company Beats Electronics, founded by rapper Dr. Dre and Interscope’s Jimmy Iovine. The price tag? Three billion dollars.
Apple CEO Tim Cook has expressed his joy concerning the acquisition. “Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” Cook says. “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.”
That $3 billion isn’t all cash, though. The purchase price is approximately $2.6 billion, while $400 million will vest over time, according to Apple.
Beats Electronics is most famous for its iconic Beats headphones, a staple on nearly every celebrity’s neck. While there have been other celeb-branded headphones, Beats controls about 65% of the premium headphone market, and has high-profile artists, athletes, and actors promoting them.
Beats Music, the company’s streaming service, will be integrated into Apple Senior Vice President of Internet Software and Services Eddy Cue’s team. Beats Electronics will join Senior Vice President Worldwide Marketing Phil Schiller’s team. Both Dre and Iovine will be involved with the Beats Music team, according to 9to5Mac.