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recently apple’s $3.2 billion takeover of headset manufacturers Beats in the industry caused a hot tips and for speculation about the future of apple. And this is mainly due to the apple before m&a strategy has always been low-key and low prices, therefore, is considered the for apple some m&a move certainly mystery to break all the rules. Of course, there are the failure and can’t read, think apple is beautiful. We want to ask, is the apple of mergers and acquisitions Beats such as the industry really want to have to be complicated and profound?
first of all, we might as well look at apple’s $3.2 billion for apple mean? The latest statistics, apple hold about $160 billion in cash, according to the calculation, the acquisition of apple only spend about 2% of the apple holding cash. From the perspective of common sense, if you had 100 dollars, let you spend 2 yuan, you can really go to ponder this racking their brains miraculously 2 yuan for money worth it? Even painstakingly, deliberately think about the future will bring you much rewards and benefits?
for example industry widely believe, apple Beats’s ambition is to enter the music streaming service, because music streaming media service is the trend, and apple’s iTunes traditional business model has declined. Related statistics seem to support this view. According to the statistic Asymco, average from each apple iTunes account for income has been reduced from $16 in 2008 in 2014 to $1.
even so, but with apple’s iTunes users, huge, iTunes music revenue decline for apple, the company is through the application of revenue is far higher than that of music and other media. In addition, former apple CEO Steve jobs seem to have been to music streaming service is not a cold, or apple wouldn’t be in the 2009 acquisition of Lala was shut down after only 1 year according to the online music services.
we want to be here, if apple wants to do music streaming service, already done, there is no need to wait until now in this pattern has a sharp leading Pandora and services (at least on the scale of users), to users through m&a is only 200000 Beats into music streaming media field. Apple but this is not the complete negation to enter music streaming media market, but as some in the industry analysis, if apple really want large types in music streaming media market, why don’t you go directly to the Pandora and services? Visible, music streaming media market is not apple m&a Beats. That said, apple Beats mergers m&a is like the outside world puts it doesn’t make sense?
here we look at from Statista for American teenagers to buy a headset intention under statistics. The statistics show that teenagers buy Beats headphones accounted for the highest, at 46.1%, far higher than the second apple accounted for 25.3%. But after the merger, apple (combined with Beats) will be in American teenagers headphones market potential of choose and buy of around 70% in proportion to the absolute advantage.
in the same way, in the near future from Piper Jaffray, an investment bank’s latest survey has revealed that the iPhone’s popularity continues to grow, in American teenagers 61% of teenagers have an iPhone. Compared with previous data, the results of a survey is 55% in October 2013, the results of the survey is 40% in the fall of 2012. Similarly, focusing on the research of apple Asymco’s statistics also show that the iPhone momentum from teenagers. Here maybe someone will doubt, headphones and iPhone (or smartphone) what is the relationship? So we want to ask is, if there is no relationship, before why HTC in their smart phone around, even Beat for mergers and acquisitions of shares? And from a smartphone applications, the fact that music has always been the top bit (basically is to listen to, and headphones to listen to experience the importance of self-evident), it is not hard to see, music (function and experience) the stand or fall of strengthening smartphone experience for the users and the importance of brand recognition.
all analysis, we think apple Beats m&a is hoping that the iPhone and Beats at the intersection between brand positioning and interaction, and promote the Beats and the iPhone product viscosity in the youth market and attract new users teenagers to join apple’s camp, to maintain the growth of the next iPhone power is the most realistic and relevant.
as for the industry of think apple is the acquisition, and not only to its own strength, also want to place it in the related industry rivals to measure of mergers and acquisitions. Far do not say, take before Google compared with same $3.2 billion merger Nest, apple is three times the Beats of annual sales of the company, and the latter is the price of Google acquisition Nest 10 times the annual sales. What value? Is always relative.