Business

Apple's acquisition of Beats changes fate of employees

Beats headphone
Image Credit: Titanas/Flickr

In the midst of Apple’s $3 billion acquisition of Beats, the two California-based companies are choosing which employees and technological resources will make the cut.

During this week and last, Apple executives took a trip to Beats’ Santa Monica, Calif., headquarters and told various Beats employees if they would or would not be included in the acquisition, according to sources at 9-to-5 Mac.

Beats’ co-founders Jimmy Iovine and Dr. Dre will venture to Apple. As for other top executives, it’s uncertain if Beats chief creative officer Trent Reznor or Beats Music CEO Ian Rogers will hop aboard, too.

Positions at Apple have been given to many Beats employees involved in creative and development roles. Employees will receive space in Apple’s offices in Cupertino, but overall, Apple will acquire Beats’ Santa Monica office. Certain engineers working with Beats Music streaming services will continue to work out of Santa Monica.

Earlier this year, Apple CEO Tim Cook told employees in an email that hardware employees at Beats would transition to Phil Schiller’s Cupertino team, indicating that speaker and headphone makers will probably make up a huge chunk of new Cupertino staff. The email states:

“Beats Electronics has become the brand of choice for headphones and speakers in both the music and sports world, just five years after its launch. They are among the most popular and highest-rated third-party products sold today in Apple’s retail and online stores. We see an incredible opportunity to bring Apple’s legendary design and engineering capabilities to these popular products under Phil’s leadership.”

Some employees in Beats’ finance, HR, and support departments have already been laid off. Other employees were offered positions in Cupertino until the end of January 2015, and a few were offered definite positions. This week, Apple has set up a phone hotline for Beats employees to connect with Apple HR staff about transition plans and severance packages.

This acquisition gives Apple a music streaming service via Beats Music, something Apple previously hesitated to do for fear that iTunes digital download sales would be affected.

The European Union recently approved the acquisition, indicating no concern over headphone competition because “the combined (headphone) market share of Apple and Beats Electronics is low.” The EU also said that Beats and Apple headphones “differ markedly in functionality and design.” Plus, major competitors, like Bose, Sennheiser and Sony, will remain on the market after the acquisition.

More information:

Apple designs and markets consumer electronics, computer software, and personal computers. The company's best-known hardware products include the Macintosh line of computers, the iPod, the iPhone and the iPad. Apple software includes t... read more »

Beats Music is a music streaming service spun out of Beats Electronics and into its own company in early 2013. The core experience will be centered around curated playlists created by musicians and music writers. It is currently in pri... read more »

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