This story start back when Steve Jobs creates IPOD. The whole idea behind this initiative was 'take your whole music library with you'. There were other mp3 players but the ipod along with apple was a status symbol. Soon there were white earphones everywhere. Everyone assumed you owned an ipod if you had the iconic white earphones, it really was a fashion accessory similar to when the airpods were getting into the market.
The audiophiles were unimpressed, they needed needed an alternative, something with more bass. The earphones were a little substandard to people who carefully listened to the music. Apple cared more about functionality and less of sound quality when building these earphones. Soon after apple released the ipod, beats was born. Jimmy Iovine and dr .Dre (Andre Young) started a headphone company. Beats was born to do two things, fight music piracy and make quality sound headphones. Jimmy Iovine was interested in the fight against music piracy and wanted to go after that problem, dr. Dre on the other hand wanted people to listen to music on premium sounding headphones and offered beats as an alternative to poor sounding quality cheap headphones.
In mid 2008, the first headphone released, monster. The headphone cost $350, which was relatively high for the time. Beats had partnered with monster inc, an electronic company that had the factories and the know how to create the headphones. They turned the beats brand into a fashion accessory pushing this through pratnering with celebrities and athletes. The hallmark was in Beijing when Lebron James asked for 12 Beats headphones and gave it to his team. Soon after, everyone wanted one. More Celebrities started to attach to the brand. Beats took this opportunity to make celebrity themed beats.
Beats bought out MOG, a music streaming service. Beats had just entered a new market to fight piracy. Beats was competing against other very well established brands in this new space but was never able to match up. Beats moves forwards and launched beats music and shuts down MOG. They offered better sound quality than spotify, youtube and most of the other music streaming services.
Beats had managed to serve itself a large chunk of the premium headphone market share. At its peak, they had about 70% of all premium headphone users using their product. They partnered with mobile companies and provided their headphones packaged along with premium phones purchased.
In 2014 apple makes its biggest acquisition at the time, beats electronics and beats music was sold for $3 billion. Beats music was turned into apple music and turned out to be a big success making revenues of $4.1 billion in 2020 alone. They kept Beats electronics in operation running as more of a side project, a competitor to some of its own products. They however built the beats headphone with some apple chips, meaning they work well with apple devices wirelessly. Apple got rid of the headphone jack in preparation for airpods which go one to sell 35 million units becoming apples most popular accessory. Many new airpods design come out and in 2020 we saw the release of the airpods max.
We would all be excited to see what direction apple takes in the future, all we know is beats may have shaped the company into what we see today.