Apple Beats Music Service in Talks with Musicians for its Streaming Service

Apple bought Beats Electronics for $3 billion in May 2014 with the founder, a rapper and producer; Dr Dre joined the company to works on its music service.   Jimmy Lovine, the former chairman of a record label Interscope Geffen A&M has also joined the team. Not long after the purchase, Apple announced that the company will revamp Beats Electronics from a headphone manufacturer and streaming service provider to provide streaming service under Apple.

Beats Music, as it is called now, will be re-launched this summer. There is possibility whereby it will be given a new name as well as there will be 2 subscription plans, $9.99 per month for individuals and $14.99 per month for family.

The company is currently in talks with a few musicians such as Florence and the Machine, a British group which is going to release an album in June; to give Apple limited streaming rights to a track as well as Taylor Swift and others about partnerships.

Tidal, a company providing music streaming service owned by Jay Z and 16 other musicians including Beyonce and Rihanna, is also similar tactics as Beats Music. The company is charging $9.99 for a standard monthly service and $19.99 for high-fidelity.

Another company which is providing the same music streaming service is none other than Google Inc with its YouTube and Spotify Inc. YouTube is well-known as the top destination for music, where you can listen or watch video online. YouTube is free, however, it also offer ad-free service called Music Key at $9.99. Spotify also provides music streaming service where users can listen to the music. It also offers paid version to allow user to download music and ad-free for $9.99 per month.

Apple Beats Music Service in Talks with Musicians for its Streaming Service

Apple to Rebuild Beats and Integrate It Inside iTunes

Since Apple has acquired Beats by Dr Dre earlier this year, the tech giant company is planning to rebuild Beats Music and integrate it into iTunes by next year. This movement is done in the hope to bring up Apple’s iTunes service sales which is currently declining. The revenue from the service is down 13 to 14 percent this year until the moment when this article was posted. It is a big jump compared with the 2.1 percent decline in the previous year.

It is not confirmed whether there will be a free streaming option offered when it is re-launches. Beats Music is priced at $10 monthly, with no ad-supported business model like Spotify. Beats has also recently launched an Apple TV channel and released a “Listen Now” integration with Shazam.

Before the acquisition by Apple, Beats is making headphones, therefore, that was one area whereby we expect this movement would help Apple. However, while integration with iTunes would makes sense, Steve Job’s biographer Walter Isaacson mentioned that Beats will be exploring possibility to be video content providers.

The official announcement could come as soon as in the first half of 2015. We are excited but we only can wait and see.

Apple to Rebuild Beats and Integrate It Inside iTunes

Former Beats Executive Sues Beats Electronics, Seeks $20 Million

Former Beats Executive and founder of the streaming music service MOG Inc. is suing Beats Electronics. He filed a lawsuit in the Los Angeles superior court and his claim is that he was unjustly fired for financial gain. His stance is that had he not been fired, he would have owned some equity in the company which was the main cause of firing him from it.

Beats Electronics is currently in the process of being bought by Apple Inc for $3.2 billion. Beats Electronics bought the streaming music service MOG Inc about two years ago.

According to Hyman, he made a deal to sold MOG Inc with the condition that he would be given 2.5% share in the company if Beats reached $500 million market value. He was fired when it looked inevitable that he would get the share, and this prevented him from “receiving the fruits and benefits” of the deal according to his claim.

Hyman’s court filing show that he was fired in a year, before the company could reach the amount set in the agreement. His claim that he was fired so that he would not get his share in the equity may be true. Hyman is trying to get $20 million for Breach of Contract.

The singer Dr. Dre and music producer Jimmy Iovine were not named in the lawsuit, although if they are still owners than it affects them as well.

Rumor has it that Apple is aiming to buy Beats Electronics for $3.2 billion. David Hyman was promised a 2.5% share in the company. A 2.5% share of $3.2 billion would be $80 million. Of course he is asking for $20 Million, which is a lot less if Apple really buys Beats Electronics for the price. Since the music streaming service is also a part of the package, it is included in the overall cost.

Former Beats Executive Sues Beats Electronics, Seeks $20 Million