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Leaked video almost put Apple and Beats deal in jeopardy

Apple and Beats acquisition

When Apple confirmed it was acquiring Beats for $3 billion in 2014, the deal became news around the world. However, Tripp Mickle’s book ‘After Steve’ has now revealed that the deal between the two companies has been nearly jeopardized after a video of Dr Dre leaked onto the web.

In 2014, before the two companies confirmed the acquisition, many rumors were circulating about the negotiations. Yet, since Apple is very secrecy-minded, no one could say a word about it. But as detailed in a chapter of Mickle’s book (via iMore), the deal had been pretty much confirmed by a video.

Beats co-founder Dr. Dre appeared in a video with actor and singer Tyrese Gibson where he celebrates Dr. Dre becoming a hip-hop billionaire, referencing Beats’ acquisition by Apple. Jimmy Iovine, also a co-founder of Beats, immediately received a call alerting him to the video which had been mistakenly posted on Facebook.

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After this event, Apple CEO Tim Cook invited Dre and Iovine to Cupertino for a private chat. The book says Cook was “disappointed”, but would not walk away from the deal as he was convinced acquiring Beats was the right thing to do.

Iovine was anxious and worried that Cook would kill the case. Instead of the anger and swear words that would have poured out of Jobs at a time like this, Cook exuded calm. He told music executives he was disappointed and wished Dre’s social media outburst hadn’t happened, but said the video didn’t shake his belief that buying Dre Beats was good for Apple.

Even so, there were consequences. The Beats acquisition was completed for $200 million less than expected. Although rumors at the time suggested that the low number of Beats Music subscribers drove the price down, the book alleges that Apple reduced the amount paid to Beats after Dr. Dre’s mistake.

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Apple acquired Beats Electronics and Beats Music. Although the company’s headphones are still available from Apple under the Beats brand, Beats Music has been integrated into Apple Music.

After Steve: How Apple Became a Trillion Dollar Company and Lost Its Soul revisits Apple’s last decade, just after Steve Jobs stepped down as CEO to take care of his health. For a more in-depth look at the post, be sure to read 9to5Mac’s reviewed by Zac Hall. The book is now available in stores.


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