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Apple Buys Beats Headphones For $3 Billion

I was astonished by this story last month, this is the biggest deal in the history of the audio industry.  Image: Open'er Festival 2011 - PrimusBeats Headphones is a young company, how could they be worth that much money already?

If you’ve read any of the pundits who follow these things, they say it was the subscription streaming part of Beats that Apple wanted. However that doesn’t make sense, Apple already owns the biggest downloading music site in the world with iTunes and if they wanted a subscription service, Spotify would have been a better candidate with 26 million subscribers vs. Beats’ 200K.  No, it wasn’t the subscription business that got Apple to part with $3 Billion.  There’s much more to this than at first meets the eye.

In just 6 short years, Beats Headphones grabbed a 51% market share of the headphone category, generating sales of $1 Billion last year!  I had no idea it was that big, far more than audio industry headphone pioneer Koss and audiophile favorites Sennheiser, AKG, Beyer, and the rest combined.  Clearly Beats is connecting with a broad consumer market made up of young professionals and millennials.  Beats Headphones got big by using Dr. Dre’s connection to the hipsters and young professionals. Even without the high quality of the other brands, Beats figured out how to win the cool factor with colors and the trend-setting hip-hop leadership of Dr. Dre and legendary record company exec Jimmy Iovine. Wow, Apple bought these two guys to give them that connection to consumers for an array of audio products they have planned.  That maybe the smartest decision Apple has made in the post Jobs era.

wireless party 2Apple has a huge consumer base with its iPhones and iPads, selling them all a $100 Beats headphone instead of cheap ear buds would be the logical reason to make this acquisition.  They did focus group market research for months ahead of the decision and learned that regular consumers (not audiophiles) favor listening to music on sealed headphones over in-room speakers because the headphones have better clarity and resolution than full-size speakers do in-room.  They can play the music louder too, maybe not the best idea but to each his own.  At least the neighbors can sleep!  MP3 files dont sound so bad on headphones either.

Audiophiles know this is true, the acoustics of the listening room imprint on the sound that reaches our ears, adding coloration that’s not present in the music when listening on a pair of good sealed headphones.  In fact listening on headphones is the new rage for Wireless Parties or Quiet Parties as they are sometimes called. This is a new cultural phenomenon made possible by sealed Bluetooth Wireless models.  Somewhere in the back of my mind I knew this was coming.

For me the tie-in is obvious, we have a huge new market evolving of non-audiophiles that might be interested in a full size speaker if it sounded more like headphones Essence 1200 Ensemble with subdo, with that kind of clarity and resolution.  Essence Electrostats are very directional, just like the headphones, they beam the music from the source directly to the ears.  The direct sound of the recording arrives ahead of the reflected sounds, which arrive later in time and lower in level so they dont interfere with our ability to experience the stereo image with a palpable sense of realism that can jar the senses with awe and wonder.  Its just like good sealed headphone listening but on a bigger scale.

Hearing is a survival skill, the ability to hear a twig break from 50 yards away in any direction and be our abiliity to locate the possible source of danger is the difference between life and death.  In the same way, all of us have the capacity to resolve a precise stereo image if provided enough directional cues at the right time, ahead of the reflected sounds.

The sound from both channels must arrive simultaneously at each ear, and just like on the headphones, there is only one place that can happen. The sweet spot is the only place where the sound from both front speakers can arrive at your ears at the same time.  When the sweet spot listening position is equidistant to the speakers as they are to themselves, the sense of realism, clarity and resolution of the best headphone experience is reached when listening to music on Essence Electrostats. You hear more music, less room.  We call it the ultimate listening experience because it is something special, no other speakers are able to render as precise a stereo image as the Essence’s are.

Aim a pair of these gorgeous transparent panels at your sweet spot and be ready for the ultimate listening experience. Conventional speakers are unable to do this, their dome tweeters spray the sound all over the room so too much of the reflected sound arrives ahead of the direct sounds. Too much reflected sound without enough direct sound makes it impossible to get the precision stereo image only attainable with electrostatic speakers.  

Have you heard the Essence Electrostats yet?  Ask your local dealer for a demonstration, we can arrange it.


Bob Rapoport

Award-winning sales and marketing exec, consultant and product launch specialist to manufacturers of high performance audio / video products for consumer and professional applications. Holder of 2 patents for analog matrix surround decoding, winner of 12 CES Innovations Design & Engineering awards, recognized in the Who's Who of American Inventors, and the leading advocate for adoption of the Blu-ray audio standard for music and movies; currently the CEO of Essence For Hi Res Audio manufacturing the HDACC Upsampling 24/192K DAC Preamp, DPA-440 Class D Power Amp, and online marketer in the USA for Acoustic Energy, Ceratec, Core Power Technologies, REVO, Verisonix Headphones, and ARCHT One.

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  1. By: Bob Rapoport

    on: July 15, 2014 .

    Haha Dave, I read about that jack proposal too, lol. That combination sounds pretty sexy, there are some upcharges to get them that way but we can do it.

  2. By: Dave McDaniel

    on: July 14, 2014 .

    Maybe they plan to combine a pair of Beats cans with their proposed replacement for the 3.5mm audio jack lol, either way, they are welcome to each other.
    Trying to picture the Essence Electrostats in black with the optional blue panels…..


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